What is Velvet (VELVET)?

Deep Dive

1. Purpose & Value Proposition

Velvet addresses fragmented DeFi experiences by integrating AI agents that automate trading, optimize yield strategies, and manage risk. Its "DeFAI" (Decentralized Finance + AI) framework allows users to execute cross-chain swaps, create tokenized portfolios, and access AI-driven market analysis via natural language commands. The platform targets traders, DAOs, and funds seeking consolidated tools for on-chain activity (Velvet.Capital Docs).

2. Tokenomics & Governance

$VELVET’s utility revolves around veVELVET (vote-escrowed tokens), earned by locking $VELVET for up to four years. Stakers gain:
- Real Yield: 50% of protocol fees (trading, vault management) are swapped to $VELVET and distributed.
- Governance: Voting on emissions, partnerships, and upgrades.
- Fee Discounts: Up to 50% reduction based on veVELVET holdings.
Tokenomics include capped emissions (declining as organic revenue grows) and allocations for ecosystem growth, liquidity, and team incentives (vested over 1–3 years).

3. Ecosystem & Differentiation

Velvet’s ecosystem features:
- AI Co-Pilot: Executes trades, analyzes tokens, and auto-rebalances portfolios.
- Tokenized Vaults: 10,000+ user-created strategies, accessible via API or UI.
- Gems System: Rewards platform activity (trading, referrals, staking) with monthly $VELVET payouts.
Unlike competitors, Velvet emphasizes non-custodial control and intent-based automation, letting users retain asset custody while AI handles execution (Cointelegraph).

Conclusion

Velvet merges AI efficiency with DeFi’s permissionless ethos, offering a unified hub for cross-chain trading and automated wealth strategies. As DeFi evolves, can Velvet’s AI-first approach become the standard for on-chain asset management?