--- title: "Aerodrome Finance" url: "https://caper.network/wiki/daos/dexs/aerodrome-finance" updated: 2026-09-10 license: CC-BY-4.0 license_url: "https://creativecommons.org/licenses/by/4.0/" --- # Aerodrome Finance | | | | --- | --- | | **Project** | Aerodrome Finance — Base's primary liquidity marketplace | | **Model** | ve(3,3) DEX in the Solidly lineage (AMM + vote-escrow + gauge-directed emissions) | | **Chain** | Base (Coinbase's Ethereum L2) | | **Launched** | August 2023, by the team behind [Velodrome](https://velodrome.finance/) (now [Dromos Labs](https://thedefiant.io/news/defi/dromos-labs-merges-aerodrome-and-velodrome-into-new-dex-aero)) | | **Token** | AERO (ERC-20) → lock up to four years for **veAERO**, a transferable voting NFT | | **Emissions control** | Weekly gauge voting; voters take 100% of trading fees and incentives from the pools they back | | **2026 turn** | Merging with Velodrome into a cross-chain DEX, "Aero" — announced, not yet launched as of 31 July 2026 | | **On Caper** | Participation is earned and _soulbound_ — the opposite of a sellable vote-lock | | **Related** | [Curve](/wiki/daos/dexs/curve-dao), [Convex](/wiki/daos/lending/convex-finance), [Balancer](/wiki/daos/dexs/balancer-dao), [Pendle](/wiki/daos/lending/pendle-finance), [Token-weighted voting](/wiki/dao-governance/concepts/voting/token-weighted-voting) | **Aerodrome Finance** is the dominant decentralized exchange on [Base](https://www.base.org/), Coinbase's Ethereum layer-2, and one of the clearest live examples of the **ve(3,3)** governance model still running at scale. It launched in [August 2023](https://blockworks.com/insights/aerodrome-finance), built by the team behind Optimism's Velodrome, who had [re-engineered Solidly](https://www.coingecko.com/learn/what-is-aerodrome-finance-aero-base) — Andre Cronje's original ve(3,3) design — into a "meta" DEX that stitches together the liquidity structures of Uniswap V2, Curve, Uniswap V3, and Convex's incentive model. Where most DAOs in this directory bolt governance onto a protocol, Aerodrome makes governance the protocol: who votes, and how, directly decides where the exchange's liquidity flows each week. ## The ve(3,3) engine: lock, vote, earn Aerodrome's design is a tight loop. The AERO token is a reward emitted to liquidity providers, but its primary purpose is to be _locked_: lock AERO for up to four years and you receive **veAERO**, a voting NFT whose weight scales with how much you locked and for how long ([Blockworks](https://blockworks.com/insights/aerodrome-finance)). Each week — an **epoch** — veAERO holders vote on **gauges**, choosing which liquidity pools receive the following week's AERO emissions. A pool that wins 10% of the vote gets 10% of that epoch's emissions, deepening its liquidity ([CoinGecko](https://www.coingecko.com/learn/what-is-aerodrome-finance-aero-base)). The incentive that makes the loop turn is where the fees go. Aerodrome routes **100% of trading fees and 100% of external incentives** ("bribes") to the veAERO holders who voted for each pool, in proportion to their share of that pool's vote — not to passive LPs ([CoinGecko](https://www.coingecko.com/learn/what-is-aerodrome-finance-aero-base)). A voter is therefore paid to direct emissions toward the pools that will generate the most fees, which is the same self-interested gauge dynamic that produced the [Curve Wars](/wiki/daos/dexs/curve-dao) and the [vlCVX vote markets](/wiki/daos/lending/convex-finance) — carried onto Base, one chain removed. ## A vote-lock you can sell One design choice sets Aerodrome apart from Curve's original template, and it matters for governance. veCRV is _non-transferable_ — a permanent, illiquid commitment. veAERO is a **transferable NFT that can be sold on NFT marketplaces** ([CoinGecko](https://www.coingecko.com/learn/what-is-aerodrome-finance-aero-base)). That makes the locked voting position itself a tradable asset: a buyer can acquire another holder's remaining lock — and its accrued voting power and fee stream — without ever locking their own capital for the term. It is a pragmatic fix for the illiquidity that made veCRV so sticky, but it also means **vote weight has a spot price**. Governance influence that can be bought outright, rather than only earned by locking, is exactly the [capital-priced control](/wiki/dao-governance/concepts/voting/token-weighted-voting) that [governance-capture post-mortems](/wiki/dao-governance/concepts/analysis/how-daos-fail) keep returning to. ## Slipstream and the meta-DEX Aerodrome did not stay a Solidly clone. In 2024 it shipped **Slipstream**, a concentrated-liquidity module [closely derived from Uniswap V3](https://blockworks.com/insights/aerodrome-finance), layered on top of the ve(3,3) gauge system so that concentrated pools compete for emissions the same way constant-product pools do. Slipstream now [dominates the stack almost entirely](https://blockworks.com/insights/aerodrome-finance), with the original V2-style AMM reduced to a thin sliver of activity. The combination — Uniswap-style concentrated liquidity, Curve-style stable pools, and a vote-escrow incentive layer over all of it — is what Aerodrome means by a "meta" DEX ([CoinGecko](https://www.coingecko.com/learn/what-is-aerodrome-finance-aero-base)). ## Scale on Base The model made Aerodrome the center of gravity for Base liquidity. By a recent epoch it processed [roughly $2.84 billion in trading volume in a single week — about 57% of all DEX volume on Base](https://www.coingecko.com/learn/what-is-aerodrome-finance-aero-base). Total value locked has swung with the market: Blockworks records a [peak near $880 million in December 2024](https://blockworks.com/insights/aerodrome-finance) and cumulative protocol fees since launch [above $322 million](https://blockworks.com/insights/aerodrome-finance), while at the time of the 2026 merger announcement The Defiant put Aerodrome at [$475.9 million in TVL](https://thedefiant.io/news/defi/dromos-labs-merges-aerodrome-and-velodrome-into-new-dex-aero) — dwarfing Velodrome's ~$39 million on Optimism. As with every DAO in this directory, treat any single dollar figure as a moving, price-driven snapshot and read the live value from [DeFiLlama](https://defillama.com/protocol/aerodrome). ## 2026: the merger into Aero Aerodrome's governance is now steering its biggest change. [Dromos Labs](https://thedefiant.io/news/defi/dromos-labs-merges-aerodrome-and-velodrome-into-new-dex-aero) — the studio behind both DEXs, led by founder and CEO Alexander Cutler — is merging Aerodrome and Velodrome into a single cross-chain protocol called **Aero**, with a new AERO token replacing VELO and unifying liquidity [across every chain both currently run on, plus Ethereum mainnet and Circle's Arc](https://thedefiant.io/news/defi/dromos-labs-merges-aerodrome-and-velodrome-into-new-dex-aero). The relaunch, targeted for [July 2026](https://phemex.com/news/article/aerodrome-finance-prepares-for-aero-launch-with-major-platform-upgrades-84689), ships an operating system Dromos calls METADEX03, whose headline pieces are [Slipstream V3 — which aims to recapture value normally lost to arbitrage bots — and MetaSwaps for cross-chain trading from one interface](https://thedefiant.io/news/defi/dromos-labs-merges-aerodrome-and-velodrome-into-new-dex-aero), alongside a migration to [MEV-resistant pools](https://phemex.com/news/article/aerodrome-finance-prepares-for-aero-launch-with-major-platform-upgrades-84689) — a design goal that sits squarely inside the wider problem of [MEV and value extraction](/wiki/economics/mev-and-value-extraction). That target has slipped: as of 31 July 2026 Aero has not launched, and the project's own site commits only to arriving [“in 2026”](https://aero.xyz/). That site is also the clearest statement so far of what the merged protocol will pay for, and it reads differently from the DEX it replaces. Aero promises a **“zero-leak economy”**: 100% of exchange revenue streamed to AERO stakers, no private token sales, and every party earning through participation — across a connected set now named as Base, Ethereum mainnet, Optimism, Arbitrum, Celo, Ink, Soneium, Unichain, Fraxtal and Tea ([aero.xyz](https://aero.xyz/)). The wording matters for governance: it describes holders who _stake_ AERO to coordinate where liquidity flows, not holders who lock it for up to four years into a transferable veAERO NFT, and it does not say whether the existing lock terms survive the migration. For anyone holding a veAERO position, that is the consequential unanswered question. Dromos has meanwhile begun trailing a further primitive, **Predictive Allocation**, billed as a new on-chain mechanism shipping live with Aero ([Aerodrome, 31 July 2026](https://x.com/AerodromeFi/status/2083283195144081461)). It is a telling counterpoint to the wider [post-ve turn](/wiki/daos/lending/pendle-finance). Where Balancer deprecated veBAL and Pendle retired vePENDLE, Aerodrome is the ve(3,3) fork that kept the lock-vote-earn model, became its chain's dominant venue, and is now consolidating a second one under it — a live bet that the model's problem was fragmentation and value leakage, not vote-escrow itself. ## How Caper approaches this [Caper](/wiki/foundations/what-is-a-caper) starts from the opposite premise about what should carry a vote. In the ve model, influence is bought with locked capital — lock more AERO, or lock it longer, and your veAERO weight rises — and because that veAERO position is itself transferable, voting power ends up with a spot price. On Caper, weight is the product of two factors, `w = (t · v) / (V · T)`: the governance stake a member holds _and_ the participation they have actually shown, the latter minted one per ballot cast and 0.01 per XRD of gross trade value on each leg of a trade. Those participation tokens are [soulbound](/wiki/governance/voting) — fractional, but never sold or lent between wallets — so no member can buy another's record, and a position transferred in or borrowed for a block has almost nothing to grip. There is no lock to buy and no vote-NFT to trade: standing accrues to the account that earned it, by trading or by voting, and to no other. The same earned standing then sets each member's claim on the treasury at [exit](/wiki/foundations/leaving-a-caper) — that same `w`, not a pro-rata slice by balance, so **voice and exit are the same number**. A member who disagrees with the direction leaves with their fair share rather than quietly [abandoning](/wiki/dao-governance/concepts/membership/rage-quit-and-exit-rights) the organization — the outcome a rentable, sellable vote-lock cannot guarantee. Caper is a general DAO framework, not a DEX; the contrast is only in what governance is priced on: participation you mint yourself and can never sell on, versus a capital lock you can rent out to someone else. ## Sources - CoinGecko, [What Is Aerodrome Finance? Ultimate Guide to Base's Principal DEX](https://www.coingecko.com/learn/what-is-aerodrome-finance-aero-base). - Blockworks, [Aerodrome Finance: Data Dashboard Primer](https://blockworks.com/insights/aerodrome-finance). - The Defiant, [Dromos Labs Merges Aerodrome and Velodrome into New DEX Aero](https://thedefiant.io/news/defi/dromos-labs-merges-aerodrome-and-velodrome-into-new-dex-aero). - Phemex News, [Aerodrome Finance Upgrades for July 2026 Aero Launch](https://phemex.com/news/article/aerodrome-finance-prepares-for-aero-launch-with-major-platform-upgrades-84689). - Aero, [aero.xyz](https://aero.xyz/) — the merged protocol's own pre-launch site (economics, connected chains, launch timing). - [DeFiLlama — Aerodrome protocol (live TVL, fees, volume)](https://defillama.com/protocol/aerodrome).