Resonate Announces Partnership with Velodrome Finance
We are thrilled to announce this as our first official partnership, with many more to come! Stay tuned, the Resonate rollout has only just begun.
What does Velodrome Finance do?
Velodrome Finance, at its core, is a solution for protocols on Optimism to properly incentivize liquidity for their own use cases.
Velodrome is an AMM (Automatic Market Maker) designed to provide deep liquidity, low swapping fees, and low slippage within the Optimism ecosystem. Built on top of the groundwork laid out by Solidly, their team has addressed that first iteration’s core issues to realize its full potential.
Velodrome rewards liquidity providers and active governance participants through VELO (their native token) and veVELO distribution. Liquidity providers (LPs) receive VELO emissions. Vote-escrow VELO (veVELO) holders vote on which liquidity pools receive VELO emissions. In return, voters receive the trading fees and bribes collected by the pairs they vote for. This structure helps incentives flow to the most valuable pairs for the ecosystem.
Who is behind Velodrome Finance?
The team behind Velodrome Finance previously launched veDAO. veDAO’s founding mandate was to engage with the Solidly ecosystem, a protocol launched on the Fantom network by Andre Cronje.
The veDAO team has since developed deep subject matter expertise on both Solidly, the veNFT primitive, and the ve(3,3) mechanism, becoming a go-to resource for protocols and chains seeking support around these topics.
By the numbers, veDAO attracted $2.6B in TVL (total value locked) at its peak, securing ~10% of Solidly voting power and ~$1.1M USDC in treasury assets.
You can learn more about them from their fantastic interview with our friends at BlockBytes.
What are we doing together?
Velodrome will be one of the first protocols to create an active pool on Resonate.
Velodrome has committed to initially deploying 1,000,000 VELO to this Resonate Pool, which is projected to catalyze an increase of $450,000 in TVL. Velodrome will be offering a yield of 5% as upfront bribes to VELO/USDC liquidity providers to lock their liquidity for 1 month — equivalent to an APR of 60%!
This means that if you were to LP $100 worth for 1 month; you would now have the option to lock your LPs for a month within an FNFT through Resonate for an immediate buyout of $5 in VELO* paid to your wallet — funded by Velodrome. You would retain the rights to your VELO/USDC LP principal locked within your own unique FNFT, while Velodrome would gain ownership of your future yield through a separate FNFT.
Within these FNFTs, the pending interest can be claimed at any time (assuming there is yield to be claimed), either individually or batched (claim all FNFTs interest accrued at once). It is important to note that both of the FNFT’s remain liquid (unlike the underlying locked tokens) and can be sold on most NFT marketplaces.
So, where will the yield come from? Good question, and there’s a simple answer.
Upon committing to the VELO/USDC pool, Resonate will route these VELO/USDC LPs into the VELO/USDC Reaper Crypt, who, in turn, will farm them in Velodrome.
By integrating with this program on Resonate, Velodrome is forecasted to gain 1,540,000 VELO worth of of VELO/USDC LPs, from their initial 1,000,000 VELO deployment.
There are a number of benefits that can be seen from this undertaking. Firstly, this will assist Velodrome in reducing their effective emissions curve. This comes as a result of incentivizing mercenary VELO/USDC liquidity to lock down their liquidity, which will reduce the circulating supply and assist in offsetting active emissions. Secondly, by offering upfront payments (at a discount of forecasted yield) in exchange for the rights to a stakers future yield; it provides Velodrome the opportunity to obtain their own protocol-owned liquidity, as well as a method to grow their treasury.
We have much more planned with Velodrome, pending a successful deployment of 1,000,000 VELO at our launch. We’re certain that both Velodrome and their community will absolutely love what we have to offer and look forward to expanding this program with them!
Resonate is a Yield Futures Protocol developed by Revest Finance and built on top of Revest’s Financial NFT (FNFT) technology. Using Resonate, we’re able to separate the principal and interest components of a position by issuing two FNFTs; one containing the principal and the other containing the rights to future interest on that principal. Resonate facilitates the commerce of the rights to future interest by matching issuers (who want to sell their interest rights for a one-time upfront payment), and purchasers (who want to buy the rights to future interest for a one-time upfront payment).
About Revest Finance
The Revest Protocol offers a revolutionary new use of NFTs as financial tools through the Financial Non-Fungible Token (FNFT). Individual and enterprise-level users can deposit any ERC-20 or ERC-721 into Revest’s interactive FNFTs and set custom unlocking conditions (time, value, or contract-based). Revest allows the tokenization of all non-fungible financial positions with non-fungible tokens. This simple turn-key solution offers elegant applications ranging from token vesting to cutting-edge implications for derivative and borrowing/lending platforms. Revest’s flagship product, Resonate, is underpinned, fundamentally, by this innovative technology.
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