Mike’s Quarterly Update - Q1 2022
In this update, we'll discuss our progress and achievements in the quarter, some first-ever events and releases, and a preview of what's on the horizon.
Hi Velo Community,
I hope everyone is doing well.
We’ve had an action-packed start to 2022 at Velo, and I’m excited to be able to connect with you all once again in my Quarterly Update. In this update, we’ll discuss our progress and achievements in the quarter, some first-ever events and releases, and a preview of upcoming activities for Q2 and beyond.
Let’s jump right in!
Starting broader than Velo itself, recent world events have put stress on the financial markets, including cryptocurrencies broadly and Velo specifically. Having said that, we are starting to see bullish sentiment return to blockchain projects and the crypto market.
On the blockchain front, digital assets continue to see monumental jumps in adoption and what that means for Velo is increased momentum and partnership opportunities. And despite the tremendous upheaval in world financial markets, digital asset transaction volumes for the largest cryptocurrencies remain constant, while transaction volume across the Stellar Network, in particular, has been strong. This indicates a growing appetite for digital currencies in international payments — our core thesis here at Velo Labs.
International Payments Partnership announcements
The partnership pipeline at Velo continues to grow and we are excited to bring more and more currency corridors to our network. Building an unparalleled, interoperable network that allows for transformative cross-border payments continues to be our core product and is the anchor to our growth.
Just last week we announced another exciting partnership and corridor launch, this time in the Philippines, with the help of the Philippine Digital Asset Exchange (PDAX). Together, we are driving improved cross-border payments to the Philippines, using the transformational power of blockchain technology.
This is a huge opportunity given there is an estimated 34 billion USD in remittances arriving into the Philippines each year. Cross-border payments using traditional financial systems are slow and expensive, requiring a number of intermediary institutions to settle transactions. Velo Labs and PDAX aim to improve on the current inefficiencies by leveraging Velo Labs’ blockchain payment infrastructure to bring secure, near real-time, and low cost payments to both the Philippines cross-border market and end consumers.
Roadmap and Achievements
Moving on to our roadmap and achievements for Q1.
I’m very happy to report we’ve completed two of the three milestones on our Q1 2022 roadmap, and were able to move up two of the Q2 2022 milestones into our Q1 releases.
The first of these milestones was our anchor integration enhancements, streamlining our sending and receiving capabilities for our core remittance product. This is a big achievement that, for now, largely affects our corridor between Europe and Thailand through our partners Tempo and Bitazza. That said, these enhancements will also improve additional corridors that will soon open, like our recent announcement of the partnership with PDAX for our new Philippines corridor.
The second milestone, launching VVA, was completed on the technology side. Unfortunately, demand-side appetite for our tokenized real estate offering lowered and we were not able to apply the technology to a live development project. When demand returns, our technology is complete and ready to go, and we are actively working to secure for future partners.
Finally, we were able to accelerate our release timeline for FCX, which we launched this month. That launch included two of the milestones from Q2 2022 (Cross Chain Order Aggregation and High Yield Staking Opportunities), which were pulled forward into Q1 and materialized in the form of FCX. Moving these Q2 milestones into Q1 caused us to move back one area that was originally planned for Q1: Support for Velo on Ethereum
The entire team is working hard to continue delivering on our milestones, and we look forward to celebrating these milestones with you.
As mentioned above, an exciting addition to our product suite, the Velo FCX trading platform, was launched this quarter, and so I’d like to spend a moment focusing on it.
In addition to our core cross-border product, we want to ensure we provide unparalleled opportunities for our community, supporters, and investors while continuing to push Centralized and Decentralized Finance forward. And that’s where the Velo FCX platform comes in.
Velo FCX is a digital asset trading platform that is built and customized for the needs of institutional traders and retail investors. It’s focused on providing the best trading experience for digital assets and differs from some of the existing crypto trading platforms in several key ways. The platform will feature an extensive inventory of Velo & non-Velo digital assets for traders to buy, sell and swap, and will incorporate cutting edge technology surrounding Smart Order Routing and Automated Market Makers, aggregating liquidity, and providing the best available exchange rates across all tradable assets. The Velo FCX platform will also enable high-yield staking programs, available only on Velo Digital Assets, presenting some exciting opportunities for new and existing Velo community members.
Currently, we are launching the Velo FCX platform through a measured rollout. We have started with a select group of institutional traders to put the platform through the paces and give us feedback. As we optimize the solution we will continue to add more retail and institutional investors. To that end, we will soon be launching a Beta waitlist where people can sign up to be an early part of the rollout. We will communicate the process to sign up for the waitlist once finalized.
In the interim, feel free to visit the initial landing page http://www.velo.org/fcx
In March, we announced a multi-phase token burn that would take place over the course of six months and would burn 6 billion VELO tokens — or 20% of total supply. This is a significant development and Velo’s first-ever token burn.
We completed the first of the six scheduled burns on March 17th. You can find all the details of this burn (and future ones) in our Medium post here: https://medium.com/veloprotocol/multi-phase-token-burn-20-of-total-supply-b11dc4daa400
The token burn was done for two reasons:
First, we believe it was the right thing for the company to do long-term. When there is a supply level that ultimately is unnecessary and we can return that value back to the investors and community over the long run, it is our responsibility to do so. It helps the company by strengthening our tokenomics and key ratios, which are important for further exchange listings.
Second, we believe it was the right thing to do for our community. We always want to return value to our community and while a token burn may not have immediate effects on short-term prices, over the long term as the lower supply is factored into the token circulation and use, we expect it to have positive effects on our token market cap.
As part of the distribution schedule we shared for 2022, several hundred million VELO tokens were scheduled for release to our investors this month. I’m pleased to say that investors have asked us to directly stake over 75% of those tokens slated for release. This reiterates their strong commitment to the Velo project and the Velo token over time.
On the Velo workforce front, we continue to make strong and strategic hires across all functions. During Q1, we hired 8 people across Technology, Product, Business Development, Marketing, and Finance. One of those hires was our Chief Marketing Officer, Mark Fisher, who started in February and has hit the ground running. He shares our vision of building an iconic brand and product, and has designs to significantly ramp up our exposure in the crypto world and elevate our project.
Since Mark joined we have already seen him reorg our community moderation, increase content production such as AMAs and Q&A videos, as well as give our website a much-needed refresh to make content production and discovery easier.
Mark is just getting started and we’re excited about building strong Marketing capabilities to drive broader demand for Velo. When I spoke about bringing in a CMO in my previous update, I mentioned we would provide more transparency, also. So I’d like to share the core priorities that our new CMO and I have agreed on for 2022.
With respect to our Marketing priorities, we are focused on:
- Increasing awareness and adoption for our cross-border payments infrastructure
- Driving engagement and use of our new product offerings like FCX and the Velo dashboard
- Supporting our community and investors and providing more opportunities for collaboration and communication
Mark has been working internally to streamline and communicate our plans and progress to the broader community and investors. As a result, you will see increased communications and opportunities for engagement starting now (and in Q2 and beyond).
What’s upcoming in Q2
As we move into Q2, we are committed to remaining focused on our strategic priorities.
We will continue delivering against our roadmap, focusing on our priority use case of improving cross-border payments. The technology that supports our cross-border payment infrastructure and ecosystem, Velo Digital Credits, serves as a core building block to our product suite and thus will remain of high strategic importance. We look forward to welcoming new anchors (financial institutions) to our payment network and increasing the number of live corridors.
We are excited to continue growing Velo’s project awareness through increased marketing activities and communications. Velo’s technology is the apex solution to bridge centralized and decentralized finance, and attracting new investors to our project is a key objective.
Finally, we will remain focused on supporting our existing token holders and investors, as we continue to develop capabilities such as high yields, staking, and farming. We recognize that your support and belief in our project is critical to our success, so we’re excited to bring opportunities to you, our token holders.
Until next time…
That brings us to the end of another great quarter. From me and the entire team at Velo, we want to thank you for your continued support in our project, and I look forward to connecting with you again at the end of Q2.