Here’s Why You Must Keep Your Eye on This zkSync Platform
If you believe increased Ethereum scalability is an opportunity to take advantage of, you must look closely at this platform immediately!
On March 24, the zkSync era mainnet had $0 in total value locked (TVL). Three weeks later, it has nearly $120 million in TVL. If you are like me and think it’s only a matter of time until zkSync exceeds $500 million in TVL and then conquers $1 billion, I encourage you to read this article.
zkSync provides a cheaper and faster method for using Ethereum. In addition, it features more security than optimistic rollups (like Arbitrum and Optimism). Does this mean I think Arbitrum and Optimism’s days are numbered? Absolutely not. But, if I were a competing L1 right now, I’d be nervous about how I would compete with Ethereum now that it’s achieving scalability.
You need to be more excited because zkSync is a brand-new ecosystem, and this growth can equate to growth in your portfolio if you find and invest in the right plays. Don’t get me wrong; there are bad plays to watch out for. This week, two nefarious zkSync projects sucked over 1200 ETH out of investors’ pockets. So, you don’t want to bet on the wrong horse.
And one horse that is pulling ahead from the pack is Velocore. Velocore is a Solidly fork cloned from the well-established Velodrome code base. If you don’t understand what this means, that’s ok. In this piece, I will explain why and how Velodrome can position itself as the gateway into the zkSync ecosystem.
What are Solidly, Velodrome, and Velocore?
These decentralized platforms are decentralized exchanges (dexes) functioning differently from their peers, who incentivize users with a reward token. Instead of a reward token, they have a utility token to provide their holders with continual income.
In Velocore’s case, the utility token is $VC. $VC is rewarded to liquidity providers letting the platform use its liquidity for swapping. However, instead of liquidity providers dumping the $VC as soon as they get it, they can convert the $VC into an NFT called veVC. Converting $VC into veVC is a one-way road. It means locking your $VC for up to four years. In exchange, the veVC holder gets voting rights.
Does anyone want to vote? Typically, the answer is no. But if you get paid to vote, that may change your outlook. Every week, veVC holders get to vote on which liquidity pool they think should emit the highest $VC rewards. The $VC reward emissions for that week are determined by who gets the most votes.
Platforms looking to deepen their liquidity (every platform in existence) can offer a bribe to incentivize veVC holders to vote for their pool. Bribing allows platforms to attract liquidity without diluting their tokens. Additionally, if the platform’s pool earns higher rewards, it will draw in more liquidity.
veVC holders can earn a residual income by voting weekly on the pools they think will earn the most return. Further, if I hold a lot of liquidity in a pool and am a veVC holder, I can vote for my pool to boost its rewards.
So, it’s a riddle wrapped in an enigma framed in a sudoku directed by the guy who made Inception. The TLDR is:
- Velodrome attracts liquidity, and other zkSync platforms can pay to try to attract more liquidity
- $VC is the utility token rewarded to Velocore liquidity providers.
- $VC investors can earn residual income by converting their $VC into veVC and voting every week (called epochs). These votes earn them a portion of bribes and transaction fees from the platform.
- As Velocore gains more use and liquidity, it becomes exponentially more valuable and powerful. As a result, swaps will be priced better, and the halo effect is more beneficial for platforms to attract more liquidity on Velocore.
- More bribes and more fees mean more investors will want veVC. They can buy $VC on the platform to exchange for veVC or provide liquidity to earn $VC.
Why you must keep your eye on Velocore!
Velocore has three competitive advantages that ought to be considered by crypto investors.
- zkSync is a new ecosystem. It’s expected (by me) to grow massively. Velocore is a first-mover in the zkSync space. When new platforms launch, they will want liquidity. If swap volume happens on Velocore, platforms will bribe and partner on Velocore.
- Velocore has sustainable tokenomics as long as the platform attracts liquidity providers, partners, and users. It offers investors the choice of booking their rewards by selling the $VC token, using the $VC token in liquidity pools, or converting $VC tokens to veVC and earning residual income by voting.
- The Velocore team is sharp. Their presale was over 13X oversubscribed. The token and TVL have simultaneously shot higher in its first week. The Velocore team is compensated when the platform earns more trading fees and bribes and is paid for performance.
Key Takeaways
Sharks are already in the water on zkSync, looking to scam trusting investors out of their capital. However, the Velocore team has proven they can lead in the zkSync DeFi space. There are few quality projects on zkSync (so far), and Velocore can benefit in many ways as the ecosystem grows.
Even if you don’t invest in the $VC token, cast votes by attaining a veVC NFT, or add liquidity to the pools, keep an eye on what is happening with Velocore.
They have already announced they will introduce a new project on their launchpad next week. You can learn more about it by visiting the Velocore Discord: https://discord.com/invite/velocorexyz.
I have not been compensated to write this article at the time of writing. However, with your help, I can be! As a Velocore Ambassador, I can be rewarded for sharing the Velocore opportunity. If you have found this article informative or want to be a nice person and help me, you can visit the Velocore Discord and upvote this article: https://discord.com/channels/1085460149830955048/1093957375490281594.
Thank you in advance for your support!
I am invested in and providing liquidity on the WETH/VC pair on Velocore and own the $VC token.
This information should not be taken as investment advice. Digital assets like crypto and NFTs involve risk, so you should always perform due diligence before investing.
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