Overview
Velocore brings the ve(3,3) model to zkSync Era, Ethereum's leading ZK rollup by developer activity. The protocol implements the proven Solidly/Velodrome flywheel — vote-escrow locking, emission direction, fee distribution, and a bribe market — within the zkSync ecosystem.
zkSync Era has attracted significant developer interest but has struggled to match the TVL and user activity of optimistic rollups like Arbitrum and Base. This creates both opportunity (potential for growth as zkSync matures) and risk (current metrics are modest) for Velocore.
The zkSync DEX market is competitive, with SyncSwap, Mute.io (Koi), and others vying for liquidity and users. Velocore's ve(3,3) mechanism is its primary differentiator.
Smart Contracts
Velocore's contracts implement an enhanced version of the Solidly model with custom optimizations for the zkSync environment. The ve(3,3) mechanism is well-tested across the Solidly fork ecosystem, and Velocore's implementation includes both stable and volatile pool types.
zkSync's account abstraction features can enhance DEX UX, and Velocore has explored integrating these capabilities into its trading experience.
Security
Velocore has been audited but experienced a significant security incident in 2024, where a vulnerability in their Linea deployment led to losses. While the zkSync deployment was not directly affected, this raises concerns about the team's contract security practices.
The incident resulted in remediation efforts and additional audits, but the trust impact is notable. zkSync's ZK proof layer provides chain-level security but does not protect against application-level vulnerabilities.
Liquidity
Liquidity is modest, reflecting zkSync Era's overall DeFi TVL. Velocore's ve(3,3) flywheel operates but with limited fuel — less volume means less fees, which means less incentive for veVC lockers, creating a weaker flywheel than on higher-activity chains.
Adoption
Adoption tracks zkSync Era's overall growth trajectory, which has been below initial expectations. The airdrop farming period brought temporary activity, but post-airdrop retention has been mixed. Velocore competes with SyncSwap for the limited zkSync DEX user base.
Tokenomics
Standard ve(3,3) tokenomics with veVC voting and emission direction. The mechanism is sound but requires sufficient trading volume to sustain the flywheel. zkSync's current activity levels challenge this sustainability.
Risk Factors
- Security incident history: 2024 exploit on Linea raises trust concerns
- zkSync adoption uncertainty: Chain's TVL growth has underperformed expectations
- Competitive zkSync DEX market: SyncSwap and others compete for limited users
- Post-airdrop retention: zkSync activity dropped significantly post-ZK token airdrop
- Limited flywheel fuel: Lower volume weakens the ve(3,3) mechanism
- ZK technology maturity: zkSync is still evolving technically
Conclusion
Velocore is a competent ve(3,3) implementation on zkSync, but the security incident and zkSync's underperformance relative to expectations weigh on the assessment. The 4.2 score reflects solid mechanism design discounted by execution risk and uncertain chain-level growth.