> ## Documentation Index
> Fetch the complete documentation index at: https://natureloved-staxiq-48.mintlify.site/llms.txt
> Use this file to discover all available pages before exploring further.

# Velar

> Perpetuals and spot trading protocol on Bitcoin L2 via Stacks

## Overview

**Velar** is a decentralized trading protocol on Stacks that combines spot trading with perpetual futures, enabling advanced trading strategies on Bitcoin Layer 2. With both AMM-based spot trading and leveraged perpetual positions, Velar serves sophisticated traders in the Bitcoin DeFi ecosystem.

<CardGroup cols={2}>
  <Card title="APY" icon="percent">
    **11.3%** annual percentage yield
  </Card>

  <Card title="TVL" icon="vault">
    **\$431K** total value locked
  </Card>

  <Card title="Assets" icon="coins">
    **sBTC/STX** trading pairs
  </Card>

  <Card title="Risk Level" icon="shield-halved">
    **Medium** risk rating
  </Card>
</CardGroup>

## Protocol Type

**DEX** (Decentralized Exchange) — Velar offers both spot trading and perpetual futures on Bitcoin Layer 2.

## Key Features

### Perpetual Futures Trading

Access leveraged perpetual contracts for sBTC, STX, and other assets — a rarity in Bitcoin DeFi.

### Spot Trading AMM

Trade spot assets through automated market maker pools with competitive rates.

### Liquidity Provision

Provide liquidity to trading pools and earn 11.3% APY through trading fees and protocol rewards.

### Bitcoin L2 Native

Built specifically for Stacks, bringing advanced trading primitives to the Bitcoin ecosystem.

### Advanced Trading Tools

Access features typically found on centralized exchanges, but in a fully decentralized environment.

## Supported Assets

* **sBTC** — Stacks-wrapped Bitcoin
* **STX** — Stacks native token
* **sBTC/STX pairs** — Primary trading focus
* **Additional Stacks tokens** — Various ecosystem assets

## How to Use Velar via Staxiq

<Steps>
  <Step title="Connect Your Wallet">
    Connect your Stacks wallet to Staxiq
  </Step>

  <Step title="Navigate to Velar">
    Select Velar from the protocols dashboard
  </Step>

  <Step title="Choose Trading Mode">
    Select between spot trading or liquidity provision (perpetuals may require direct protocol access)
  </Step>

  <Step title="Execute Trade or Add Liquidity">
    For spot: Enter trade details. For LP: Add token pairs
  </Step>

  <Step title="Start Earning">
    Liquidity providers earn 11.3% APY from trading fees
  </Step>

  <Step title="Monitor Positions">
    Track performance in Staxiq dashboard
  </Step>
</Steps>

## Risk Assessment

### Risk Level: Medium

Velar is rated **Medium Risk** due to:

* **Perpetuals complexity** — Leveraged trading increases risk profile
* **Lower TVL** — \$431K indicates newer or smaller protocol
* **Smart contract risk** — Advanced trading features add complexity
* **Impermanent loss** — Liquidity providers exposed to IL
* **Market volatility** — Perpetuals amplify both gains and losses
* **Innovation focus** — Cutting-edge features may have undiscovered risks

<Tip>
  For lower risk exposure, stick to spot trading and liquidity provision rather than leveraged perpetuals.
</Tip>

## Performance Metrics

| Metric             | Value              |
| ------------------ | ------------------ |
| Current APY        | 11.3%              |
| Total Value Locked | \$431K             |
| Primary Assets     | sBTC/STX           |
| Risk Rating        | Medium             |
| Protocol Type      | DEX (Spot + Perps) |
| Trading Features   | AMM + Perpetuals   |

## External Resources

<Card title="Visit Velar" icon="arrow-up-right-from-square" href="https://velar.co">
  Access the official Velar platform for full trading functionality including perpetuals
</Card>

## Why Choose Velar?

* **Advanced trading** — Perpetuals on Bitcoin L2
* **Competitive APY** — 11.3% for liquidity providers
* **Bitcoin-native** — Built for Stacks ecosystem
* **Innovation** — Bringing CEX features to DEX
* **Growing platform** — Expanding features and liquidity
* **Trading flexibility** — Spot and derivatives in one place

## Use Cases

### For Traders

* Access perpetual futures on sBTC and STX
* Execute spot trades with AMM liquidity
* Implement advanced trading strategies
* Hedge Bitcoin exposure with derivatives

### For Liquidity Providers

* Earn 11.3% APY on sBTC/STX positions
* Benefit from perpetuals and spot trading volume
* Receive protocol incentives and trading fees

### For Advanced Users

* Leverage trading positions
* Arbitrage between spot and perpetual markets
* Provide liquidity for higher-volume pairs

## Trading Features

### Spot Trading

* AMM-based swaps
* sBTC/STX and other pairs
* Competitive pricing
* Low slippage on active pairs

### Perpetual Futures

* Leveraged positions
* Long and short exposure
* No expiration dates
* Funding rate mechanisms

### Liquidity Provision

* 11.3% APY on pools
* Trading fee share
* Protocol token rewards
* Flexible entry/exit

## Important Considerations

<Warning>
  Perpetual futures involve significant risk, including potential for liquidation and loss of principal. Only trade derivatives if you fully understand the mechanics.
</Warning>

### Lower TVL

With \$431K TVL, Velar has less liquidity than larger protocols. This may result in:

* Higher slippage on larger trades
* Less proven security track record
* Potential smart contract risks

### Best Practices

* Start with small positions to test the platform
* Understand perpetuals mechanics before trading
* Monitor positions regularly
* Use risk management tools (stop losses, position sizing)

<Tip>
  Velar is best suited for experienced traders familiar with both DeFi and derivatives trading. Beginners should start with spot trading and smaller positions.
</Tip>