Velar, a leading Bitcoin-based liquidity protocol, has joined forces with StackingDAO to introduce a groundbreaking stableswap trading pair for STX and stSTX tokens.

This partnership marks a significant milestone for the Stacks ecosystem, providing enhanced liquidity, reduced slippage, and compelling dual rewards for liquidity providers.

The STX/stSTX stableswap pool, hosted on Velar’s decentralized exchange (DEX), is designed to address critical liquidity challenges within the Stacks ecosystem.

By employing a specialized stableswap curve, it allows for rapid and efficient swaps with minimal fees, making it easier for users to enter and exit staking positions.

A key feature of the new pool is its dual incentives for liquidity providers.

Participants will receive 5,000 VELAR tokens daily and a 50% boost in StackingDAO points, which can be redeemed for potential future rewards, including airdrops.

This innovative structure aims to attract liquidity providers while minimizing impermanent loss through Velar’s upgradeable variable midpoint implementation.

This mechanism offers an edge over traditional pools, making farming programs more profitable and reducing risks for participants.

Philip de Smedt, Co-founder of StackingDAO, emphasized the importance of this collaboration:

The stSTX/STX stableswap on Velar DEX is a major step forward for the Stacks ecosystem. It brings unmatched liquidity efficiency, ultra-low slippage, and innovative impermanent loss protection.

For experienced DeFi users, the stableswap pool offers new opportunities to harvest StackingDAO points while maintaining liquidity.

Meanwhile, institutional investors will benefit from the pool’s ability to handle large-scale swaps with minimal friction.

Velar and StackingDAO are positioning this partnership as a key enabler of the Stacks ecosystem’s growth.

Velar is currently the largest DEX on Stacks, while StackingDAO leads as the top Liquid Stacking protocol, making STX staking accessible and unlocking liquidity for stacked STX tokens.

“This collaboration sets a new benchmark for Bitcoin DeFi,” said Peter Watson, CMO of Velar.

With StackingDAO, we’ve created a solution that offers liquidity efficiency, protects liquidity providers, and advances the potential of Bitcoin-native DeFi applications.

The partnership aligns with Velar’s broader mission of unlocking $2 trillion in dormant capital within the Bitcoin ecosystem.

By providing liquidity and infrastructure for Bitcoin Layer 2 solutions like Stacks, Velar is driving the evolution of Bitcoin-native decentralized finance.

The collaboration underscores the potential for synergy between innovative protocols within the Stacks ecosystem.

As DeFi continues to expand its reach, initiatives like the STX/stSTX stableswap pool demonstrate the power of partnerships in creating scalable, efficient solutions for users and investors alike.

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