You do need a temporary snapshot at the source side when the replication starts. Otherwise it is not possible to do the replication.
When you look here in our manual on how it works: https://helpcenter.veeam.com/docs/backu ... tml?ver=95
in point 8 you see: Veeam Backup & Replication requests Microsoft Hyper-V VSS to create a cohesive point-in-time copy of a VM. Microsoft Hyper-V VSS creates a volume snapshot or VM checkpoint, depending on the hypervisor version.
But that snapshot should be removed after the replication job is done