Aerodrome and Velodrome have merged into Aero, creating a unified decentralized exchange spanning seven Ethereum-compatible networks under a single token and incentive system. The new protocol replaces the predecessors’ weekly gauge-voting cycle with Predictive Allocation, which continuously distributes AERO rewards and exchange revenue according to allocations made by sAERO holders.
According to the official Aero launch announcement, the protocol went live at 00:00 UTC on October 22 across Base, Ethereum Mainnet, OP Mainnet, Arc, Ink, Robinhood Chain and Arbitrum. Existing AERO and VELO tokens can migrate into the new AERO, while veAERO and veVELO positions transition into transferable sAERO stakes.
The migration consolidates two previously separate liquidity systems without deleting their existing contracts. Aerodrome and Velodrome contracts remain immutable on-chain, but their gauges and factories are being retired as liquidity incentives move toward Aero, with their legacy frontends scheduled for later deprecation.
Predictive Allocation Replaces Weekly Gauge Voting
Aerodrome’s previous model allowed veAERO holders to direct emissions toward selected liquidity pools through weekly voting epochs. Aero keeps token-holder control over reward allocation but removes the fixed weekly cadence, allowing sAERO holders to reposition allocations throughout the week.
The system is called Predictive Allocation because participants direct rewards toward markets they expect to become productive rather than being compensated solely from historical activity. Operators allocating AERO rewards to a pool earn a proportional share of the exchange revenue generated while their allocation remains active, creating an incentive to identify demand before it fully materializes.
The process is continuous, but allocation changes are not instantaneous. At launch, each sAERO position must wait at least 48 hours before reallocating, with Aero planning to shorten that interval over time. Existing allocations remain in place unless the holder changes them, while Autopilot can automate the process for users who do not want to manage positions manually.
A separate AER Engine controls how much AERO each pool can receive. Reward caps are calculated in dollar terms and adjusted according to projected pool revenue, with capped rewards left unminted rather than redirected elsewhere, adding an emissions constraint intended to limit incentives flowing toward unproductive liquidity.
Aero Expands the Model Across Seven Networks
The merger gives Aero a broader starting market than either predecessor operated independently. Aerodrome had already developed substantial tokenized-stock trading activity on Base, while Velodrome established the same underlying incentive architecture on OP Mainnet. Aero now attempts to coordinate those liquidity markets through one token economy instead of maintaining separate governance systems.
That expansion also includes newer ecosystems. Aerodrome had already committed launch-day liquidity infrastructure to Arc, and Aero now incorporates Arc alongside Ethereum, Arbitrum, Robinhood Chain and Ink. Deployment across more networks increases the addressable trading surface, but it does not guarantee equivalent liquidity or volume on each chain.
Aero also introduces Metaswaps, which are designed to route, bridge and execute trades across supported networks using on-chain liquidity. The architecture aims to reduce liquidity fragmentation by allowing pools on one network to participate in trading flows originating elsewhere, although actual execution quality will depend on available depth and routing conditions.
The launch therefore changes more than the branding of two established DEXs. Aero replaces periodic incentive voting with a continuously operating market for liquidity allocation while extending the combined Aerodrome-Velodrome model across seven networks, leaving trading depth, fee generation and participant behavior to determine whether that new structure allocates capital more efficiently in practice.