DeFi Token VELO Gains Interest After Investment by U.S. Congressman Revealed

DeFi Token VELO Gains Interest Following US Congressman’s Investment Announcement

US Congressman Mike Collins (R-Georgia) recently announced a $15,000 purchase of Velodrome, a relatively small altcoin, in his filings. This investment brought Velodrome Finance, which has a market capitalization of approximately $79 million, to prominence. The VELO token, the native currency of the Velodrome ecosystem, has seen a 9% increase in value in the past week and is currently trading at $0.1122.

Velodrome is a decentralized finance (DeFi) protocol on layer 2 networks. Launched in June 2022, Velodrome Finance was developed from the Solidly project to support liquidity for DeFi protocols in Layer 2 solutions. Inspired by Curve Finance and the Olympus DAO, it uses a “vote escrow” mechanism designed to encourage long-term holding through staking, rebasing, and bonds.

The platform’s innovative approach aims to reduce common problems in DeFi, such as the “farm and dump” scenario, by offsetting protocol emissions with fees through a rewards system. Velodrome offers various liquidity pools where reward rates are determined by user votes. VELO’s initial distribution included 400 million tokens allocated between community members, partner protocols, the Velodrome team, and the Optimism team. VELO holders benefit from transaction fees, bribes and cashback rewards. When locked, VELO becomes veVELO, allowing users to vote in pools and influence protocol decisions.

Congressman Collins’ investment brought attention to Velodrome, highlighting its unique position in the DeFi space. This also reflects the growing interest of US politicians in cryptocurrencies, particularly presidential candidate Donald Trump’s strong support for the crypto industry, which recently went so far as to dub himself the ‘crypto President’.