DeFi

The central trading and liquidity marketplace on @optimismFND

velodrome.finance 


The deeper I go into @velodrome data, the more I realize it's a yield swap system, where VELO are call options on liquidity.

I am calling it now: You will see companies and banks start creating stablecoins, and buying reserves of these existing liquidity options.

It's far more efficient to outsource reserves to professionals and cheaper to buy calls on this liquidity rather than have them manage their own LP reserves.

Instead of a reserve backing, anyone who issues any token should buy call options on liquidity to drive outside market makers to be the "reserve" managers via AMM pairs.

nfa dyor assume this is a shill post but I will be doing more research on the options view of VELO and AERO.

I recently wrote up some thoughts on the mental model I use to when thinking about the Velodrome mechanism - https://mirror.xyz/wineman.eth/pSKr-mIsEwZhYad2xdRQNd6fpseGXB5LzWa9l0U5VME

That’s one way to look at it. This reminds of this framework I read a while back

That’s one way to look at it. This reminds of this framework I read a while back
https://warpcast.com/wineman.eth/0x40b3fc9c