What is Velodrome Finance (VELODROME)?
Velodrome Finance is a decentralized exchange (DEX) built on Optimism, a Layer 2 scaling solution for Ethereum. It serves as a key piece of infrastructure for the Superchain, offering a place for users and protocols to swap tokens and provide liquidity efficiently. Velodrome combines features from well-known AMMs like Uniswap, Curve, and Convex, and adds new tools such as dynamic fees, automated liquidity management, and emissions-based incentives.
Velodrome first launched in 2022, followed by Velodrome V2—a complete protocol redesign—in June 2023. Velodrome Finance enables low-slippage swaps through a variety of pool types: “constant product” pools for both volatile and stable tokens, and “concentrated” pools optimized for high-volume trading. All reward distribution is handled trustlessly on-chain, eliminating the need for any off-chain intermediaries. Unlike traditional AMMs, where LPs typically earn only trading fees, Velodrome offers the flexibility for liquidity providers to choose between earning trading fees or VELO emissions streamed at a predictable rate.
Users turn to Velodrome to earn competitive yields by providing liquidity, benefit from efficient low-slippage trades, and participate in Optimism Superchain’s economic activity by voting on the allocation of VELO emissions.
The native token, $VELO, plays a central role in how the platform works. Users can lock VELO to receive veVELO, which gives them voting rights over how weekly VELO emissions are distributed across liquidity pools. In return, veVELO holders earn a share of the protocol’s revenue. Liquidity providers who stake their assets in selected pools receive VELO rewards based on these votes. Emissions, fees, and incentives are all calculated and distributed on-chain each week.
$VELO is listed on Binance for trade and purchase. The live price of $VELO is updated in real-time on Binance.
