VeChain (VET) once again captures attention due to its price volatility and associated bubble risks, which requires careful consideration from investors.
VeChain's Bubble Risk
As of September 7, 2025, VET's bubble risk metric stands at 0.82, indicating a high likelihood of a price correction approaching. Historical data from the Bank for International Settlements (BIS) indicates that assets undergoing rapid price surges often incur 30-50% drops within months.
Behavior of Investment Bubbles
Since 2018, VeChain has seen multiple short-term bubble episodes, notably in late 2021 and mid-2025. These fluctuations are linked to retail investor behavior, as highlighted by a 2022 study in the Journal of Financial Economics connecting crypto market volatility to speculative trading.
Renaissance Upgrades and Their Significance
The upcoming VeChain Renaissance upgrades scheduled for December 2025 aim to overhaul VTHO generation and staking models, intending to curb inflation and foster stability. By adjusting supply dynamics, it could help mitigate bubble formations, in line with economic principles from a 2008 Federal Reserve study on asset bubbles.
As we approach the end of 2025, closely monitoring on-chain metrics and community sentiment will be crucial. The expected updates could allow VeChain to strengthen its position despite existing bubble risks.
