We are excited to announce that Inverse Finance DAO has been offered one of the initial veNFT’s from Velodrome, a new decentralized exchange on Optimism. Similar to veCRV on Curve, this provides Inverse Finance DAO with voting rights on the Velodrome platform along with other partners and the @VelodromeFi team.
Optimism is an early contender in the Layer 2 race and Velodrome is poised to rival Curve and may take a position as one of the dominant stablecoin DEXes. Establishing DOLA as one of the first stablecoins with deep liquidity on Optimism via Velodrome would open up significant opportunities for Inverse Finance DAO. It paves the way for low slippage trades, partnership fed deployments in lending protocols, reliable DOLA farming opportunities for our users, and a new revenue driver for Inverse Finance DAO.
What is Optimism?
As Ethereum grows it becomes congested and gas prices rise beyond what is affordable for many users. Layer 2 solutions such as Optimism offer fast transactions and cheap gas costs while largely retaining the security model of the base layer, Ethereum. Layer 2’s are widely viewed as the future for Ethereum. This is an exciting opportunity for DOLA to become the dominant decentralized stablecoin on Optimism What is Velodrome?
What is Velodrome?
Velodrome is an automated market maker (AMM) adapted from Solidly (for Fantom) with built-in vote-locking and a bribing system similar to Votium. Solidly hoped to become a profitable public good that would be run by its users through an incentive system very similar to Curve’s. It was initially successful and even briefly reached a TVL of $26BN. However, it suffered a series of setbacks that the VeDAO team has addressed in Velodrome.
Having ironed out the kinks in Solidly, VeDAO is migrating their token to VELO and deprecating their DAO to instead launch Velodrome today on Optimism instead of focusing on Solidly on Fantom. Velodrome is inspired by and incorporates elements of protocols such as Solidly, Curve, and Votium. The Velodrome team believes that they have patched and improved the original functionality of Solidly. The balance between emissions, incentives for voters and trading fees has been adjusted by changing initial distribution, reducing emissions and rebases, having controlled token listings, increasing non-emissions rewards for voters, and adding a human layer to support the protocol. Read VeDAO’s Medium article for more information
Why Is This Important for Inverse Users?
We’re sure many of you have seen Ethereum’s gas costs skyrocket during periods of high demand, and it stifles activity from “smaller” actors. Optimism provides near-instant transaction speeds at a fraction of the cost of transacting on Ethereum L1 and recently released the first of a series of airdrops of their $OP token.
In Velodrome, $veVELO represent time-locked VELO tokens which give concentrated voting power the longer that they are locked up. Holders, like Inverse Finance DAO, vote for which trading pairs receive $VELO rewards. This allows us to incentivise DOLA pools and expand our presence in the Ethereum ecosystem. Liquidity providers receive $VELO rewards while vested $veVELO holders receive trading fees and bribes. Liquidity providers in DOLA pairs on Velodrome will receive VELO emissions as Inverse Finance uses the voting power from the veNFT to vote for the DOLA pools. We expect to see a competitive yield opportunity for our users. Optimism has airdropped OP tokens to several categories of Ethereum users that show a desirable wallet history and they will continue to airdrop OP tokens to Optimism voters and users periodically.
Disclaimer: This content is for informational purposes only and should not be construed as legal, tax, investment, financial, or other advice.