VXD tokens are the native utility tokens of the Velix.ID ecosystem meant to facilitate the exchange of verified identities. All transactions in the Velix.ID ecosystem are made in VXD tokens. The utility of the token is to improve on the existing methods of managing and verifying identities, and due to the shortcomings of the existing methods, more businesses and organizations will sign up for Velix.ID to access an increasing number of services in a more time & cost efficient manner.
An interesting fact about VXD tokens is that it cannot be mined. The VXD tokens are fixed in number at 100 million, when created during the token sale. There isn’t and will never be any mechanism in the smart contract to create more tokens in the future but there is a transaction-based reward program for nodes that successfully host the Velix.ID Blockchain nodes.
Reward program will be made on the basis of the proof of elapsed time (PoET) consensus protocol as developed by Intel. This is because the Proof of elapsed time requires much less electricity consumption as compared to the proof of work and proof of stake consensus protocols (Read our White-Paper), thus democratizing this process to allow even individual contributors to be able to successfully host the nodes.
As discussed above VXD tokens are utility tokens for all transactions done in Velix.ID ecosystem. But why should we have native tokens (VXD) and not work with the conventional ways:
Arbitrage costs and Conversion cost
Velix.ID Ecosystem will have high frequency transactions which are very low in value, for example, especially, at the PII Level 0, the cost of a transaction will be negligible (2 cents at ICO price), therefore, the high costs that are incurred in arbitrage fees in transactions of Bitcoins and Ethers will render the Ecosystem unviable.
If fiat is considered to make the identity transactions, then global currency conversion will leave the transactions unviable for the same reason as with using any external cryptocurrency. Fiat transactions are not suitable for small high frequency transactions. As stated in the above example, when an identity transaction of 2 cents is made globally, the conversion & arbitrage costs will be too high for this transaction to be viable.
Fast and Automatic settlements within a smart contract
Smart contracts are digital agreements that execute automatically based on real-world data.
All the operations done on Velix.ID blockchain are executed by calling functions on smart contracts. Smart contracts are computer codes, capable of automatically enforcing obligations and and terms of an agreement without requiring an intermediate to approve any settlement, which reduces time of action and makes the process fast.
Easy flow of digital assets/information
Tokens work on Blockchain technology. Blockchain can be used for the transfer of any asset where exchange of information and ownership is required. There is no central authority that has control over this information. The information is appended or updated through the community rather than any individual authority which removes the practice of keeping a centralized database and peer-to-peer transactions thus making the flow of assets/information easier.
Can be used across all jurisdictions
Blockchain has the ability to cross jurisdictional boundaries as the nodes present in it can be located anywhere in the world. Velix.ID enables the decentralization of the authority and because of its distributed consensus mechanism the authentication and transaction can be done across all jurisdiction.
Ecosystem is protected from the volatile nature of other tokens
The value of cryptocurrencies varies as per the inherent law of demand and supply, which is also applicable in case of Velix.ID ecosystem. But unlike other cryptocurrencies, Velix.ID native tokens (VXD) will not get affected by any external factor as all the transactions will be done with VXD only, keeping the system more stable and user-friendly.
Redeem goods/services on a marketplace using VXD token
VXD tokens are cyclical in circulation as the VXD token are fixed in number, with reward mechanisms for both Verified-Identity Providers and the Verified-Identity holders. Apart from its primary utility, the VXD tokens can also be exchanged for other cryptocurrency or other products or goods on a marketplace especially designed for this purpose. This ensures active circulation and demand for VXD tokens, even for the people who may not want to utilize the tokens for the purpose of identity verification.
Convertible to other cryptocurrencies via an exchange
At Velix.ID, VXD tokens are primarily digital form of currency and can be used to trade. Thus, like any other cryptocurrency, VXD can also be converted or exchanged with other cryptocurrencies via an exchange.
With the idea of native token (VXD), Velix.ID will eliminate all the shortcomings of the existing Identity Verification methods; improve their efficiency and reduce the costs incurred. It will always be more cost-efficient to verify identities through the Velix.ID ecosystem than through fiat or other contemporary methods of identity verification. Velix.ID will be a preferred substitute over the existing methods. The Users will have the incentive to participate because they will control their own PII (Personally Identifiable Information), save time due to this rapid procedure and receive VXD token for authorizing the transactions. Thus, Velix.ID native token (VXD) is the upcoming revolution which will make all the transactions hassle-free, quick and uncomplicated.
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