Can VVDI Key Tool use chip 7936 to generate transponders?

No, but VVDI2 can.

I just installed Xhorse Update Kit. It showed versions 2.0.6, 2.0.7, and 2.2.0. My version when I purchased was 2.0.6. I tried 2.0.7 and it said it was not available in my area. So, just to try….I attempted 2.2.0. It worked. After this, I was able to use a 7936 chip that read as Password Manchester Unlocked and convert it to a Crypto Manchester Unlocked and then convert it back to Password. Hope that makes sense.

Confirmed by Amardeep Sandhu and Philip Davidson

Information src: Facebook group- Xhorse the best: https://www.facebook.com/groups/304426429957190/

chip 7936:

Xhorse VVDI2: