Vela Exchange is a decentralized exchange with advanced perpetuals trading capabilities, community focused incentives, and scalable infrastructure. In this blog post, we’ll dig down into ‘What is Vela Exchange’ and explore everything you need to know about this DeFi platform.
Contents
What are the benefits of using Vela Exchange?
Vela Exchange provides several advantages over centralized exchanges.
Launched on the Arbitrum, it offers a fair and equitable system for platform rewards, enables self-custody of assets, and eliminates the need for a centralized clearing house.
Unlike legacy decentralized applications and exchanges that suffer from high execution costs, low performance, and other inefficiencies, Vela Exchange is a ‘next gen’ platform designed to address common DEX issues such as front-running, slippage, asset limitations, and lack of risk management features.
What trading features can be accessed on Vela Exchange?
At present, Vela Exchange supports perpetual futures trading, with spot, OTC, and other marketplaces expected to be available soon.
A complete list of features and supporting documents can be found on their website. Additionally, the Vela Exchange team has launched a separate application called Dexpools, which includes secure, escrow-less peer-to-peer swapping functionality, as well as chat and advanced alerts for OTC traders.
This application may be integrated into the Vela Exchange platform in the future.
Getting Started
Traders can setup their Vela Exchange accounts by simply connecting a supported wallet via the user interface.
Supported wallets include:
- Wallet Connect
- Metamask
- Coinbase Wallet
- Fortmatic
- Portis
Optional account features include adding an email or phone number to receive notifications and alerts. These are not required and are hosted in secure, encrypted servers hosted by enterprise providers with high uptime and availability.
Click here to get started on Vela
Trading Fees
There are two trading types of fees you will see on VELA Exchange: Position and Funding fees
Position Fee:
- Crypto Asset – To open a position, you will need to pay a maximum 0.1% fee of the position size opened. Same amount must be paid to close a position.
- Forex Asset – To open a position, you will need to pay a maximum 0.01% fee of the position size closed. Same amount must be paid to close a position.
Funding Fee: Once a position is opened it starts to accrue funding fees based on how much is being borrowed from the vault and the current funding rate (which resets every 4 hours and is also dependent on if Long (L) or Short (S) as shown in the image below). The longer a position is held open the higher the funding fee will be which is paid out upon closing the position.
As an example, assume you open a $10,000 ETH Long position with 5x leverage (meaning you’re borrowing $8,000) and you close this trade out completely 6 hours later, or 2 funding periods. Also assume the rate (0.051%) given in the above image doesn’t change over this 6 hour period. Your total funding fee would be:
FundingFee=8000×0.00051×2=8.16
Fee Discounts
TIP: In order to pay less Trading Fees on any asset class, users can stake VELA and/or eVELA tokens. (see table below.)
| Staked VELA + eVELA | Discount |
|---|---|
| 500 | 2% |
| 2,500 | 3% |
| 5,000 | 5% |
| 10,000 | 10% |
| 25,000 | 15% |
| 50,000 | 20% |
| 100,000 | 30% |
| 250,000 | 40% |
| 500,000 | 50% |
Distribution of collected fees:
50% → VLP pool (in USDC) 10% → VLP stakers (in eVELA) 5% → VELA stakers (in USDC) 10% → VELA stakers (in eVELA) 25% → Project Fund
Token Economy
Vela Exchange is supported by a robust token infrastructure to facilitate community member rewards and other utility.
$VELA
The primary utility token of the Vela Exchange ecosystem.
$VELA can be traded on Arbitrum via Camelot DEX (VELA/ETH), Uniswap V3 (VELA/USDs) and TraderJoe (VELA/ETH).
$VELA Contract Address: 0x088cd8f5eF3652623c22D48b1605DCfE860Cd704
$VLP
Liquidity provider token that provides holders and stakers with rewards and incentives.
$VLP Contract Address: 0x4e0D4a5A5b4FAf5C2eCc1C63C8d19BB0804A96F1
Liquidity provider tokens, escrow tokens, and information about other aspects of the rewards infrastructure can be found in the Rewards section.
Final Thoughts
If you’d like to get started on Vela Exchange you can head on over on the link below – we may get a small commission if you trade on Vela which helps us keep the lights on at coinesper.com. Thank you in advance.
