Our governance model ensures that Velvet becomes a decentralized community-managed solution by introducing VLVT, a governance token which will provide voting power to token-holders who stake their tokens with Velvet and will provide allocation of the fees to the token-holders participating in the project governance.
To incentivize further development, each token holder will be able to submit a proposal (e.g., add a new integration with other DeFi protocols or create a new portfolio), and receive an allocation of tokens upon successful voting and implementation. The majority of the tokens upon issuance will be allocated to the contributors (current and future) in a form of a Velvet Ecosystem Fund.
Our early adopters will also be eligible for receiving tokens in proportion to the TVL they have on Velvet and the time they've been using the platform. We will be including staking mechanism for users, in which they will be able to lock their portfolio tokens (e.g., TOP5) to earn VLVT rewards.
To increase protocol defensibility, the key use case for VelvetDAO tokens will be Risk Management. To earn fees, participants would have to stake their tokens into a Safety Module that will act as a backstop in case of losses due to protocol vulnerabilities or exploits of yield farming solutions. This will align responsibility (doing due diligence and voting on integrations) with accountability (staking tokens at risk) for the participants and will create a network effect that increases benefits for users with the growth of the project providing increasing safety.
The project will follow principles of progressive decentralization that allows for lean development, tight execution, and quick learning by the core team in the very early stages, rapidly validating product-market fit and developing the core architecture. As the project grows further, it will be gradually decentralized bringing and incentivizing contributors from the community.
Source: a16z Progressive Decentralization: A Playbook for Building Crypto Applications
We’re a family at Velvet.Capital and we’re always looking to add to our community. We respect the OGs and want to build the DeFi future with you. If you join our whitelist, we won’t forget it. In doing so you will be given access to exclusive perks and benefits as we roll them out onto our platform.
Some of those could be fee rebates, referral bonuses, raffles for fun SWAG, and other fun stuff but most importantly for your early commitment to us, we will give you a token allocation. We have set aside a pool of tokens to reward and encourage early adoption. The earlier you sign up with us, the higher number of tokens you will be allotted.