What is an Aerodrome?
What is an Aerodrome
Aerodrome is emerging as a major player in the world of decentralized finance. Built on Coinbase's Layer 2 blockchain platform, Base, this decentralized exchange aims to provide a user-friendly experience using the Base blockchain infrastructure, which provides fast and low-cost transactions.
Aerodrome is a decentralized exchange built on Coinbase's Layer 2 blockchain platform Base. The owner of the largest TVL in the Optimism network is Velodrome Finance's project on Coinbase. While the Base blockchain attracts attention by providing fast and low-cost transactions, Aerodrome aims to offer a decentralized exchange experience using this infrastructure. This platform aims to become the liquidity hub of Base by combining a powerful liquidity incentive engine, vote-lock management model and user-friendly experience.
Technical Specifications of Aerodrome
Liquidity Incentive Engine: Aerodrome uses a liquidity incentive engine to attract liquidity providers to the platform. This engine rewards liquidity providers with AERO tokens. These rewards can be used to participate in the management of the platform or earn staking rewards.
Vote-Lock Management Model: Aerodrome uses a vote-lock management model. This means that users must lock their AERO tokens for a certain period of time in order to participate in governance voting. This approach helps ensure that management decisions are made in the best interests of the platform.
User-Friendly Interface: Aerodrome has a user-friendly interface through which users and liquidity providers can easily use the platform. This allows even new users to easily start using the platform.
Aerodrome's Role in the DeFi Field?
Aerodrome is a DEX that is poised to play an important role in the field of decentralized finance. At the time of writing, it has taken its place as the leading protocol over Base with a TVL of $180 Million. Last month, Base strengthened its position among Ethereum Layer 2 platforms by surpassing Arbitrum and Optimism in the field of daily transaction amount. With its launch, Aerodrome aims to become the decentralized liquidity source of the Base network.
Aerodrome Tokenomics
The total initial supply of the AERO token project is determined as 500 million coins. 90% of this supply, 450 million coins, is locked with a locking mechanism called “veAERO” to encourage long-term participation.
Participation in the long-term project is one of the cornerstones of success. Therefore, the AERO project team has adopted the strategy of keeping a large portion of the total coin supply locked. In this context, we see that 450 million coins and AERO are locked to encourage long-term participation.
The AERO project team plans to distribute 200 million coins, which constitute 40% of the total initial supply, to veVELO holders. In addition to rewarding existing veAERO owners, this airdrop aims to reach a wider user base.
veHow Does AERO Work?
The Aerodrome platform has a special incentive system to support collaboration between users and protocols. In this system, protocols offer rewards to veAERO holders by locking veAERO tokens. In return, veAERO holders receive 100% of trading fees and incentives generated from their preferred liquidity pools.
Protocols and veAERO: Protocols can lock veAERO tokens and deposit incentives into these pools when targeting specific liquidity pools. These incentives are used to direct users to provide liquidity to specific pools.
Users and Liquidity Pools: Users can join their preferred liquidity pools with AERO tokens that are locked by the protocols. In this way, they can benefit from both transaction fees and pool incentives.
This system creates a reciprocal relationship between protocols seeking to attract liquidity and users seeking return maximization. Protocols offer rewards to incentivize liquidity providers, which increases users' returns.
Aerodrome is emerging as a major player in the world of decentralized finance. Built on Coinbase's Layer 2 blockchain platform, Base, this decentralized exchange aims to provide a user-friendly experience using the Base blockchain infrastructure, which provides fast and low-cost transactions. Powered by a liquidity incentive engine, vote-lock management model, and veAERO tokens, Aerodrome offers a system to attract liquidity providers and encourages users' participation in platform management.
