DeFi developer Dromos Labs is shaking up the decentralized exchange space. The team behind AerodromeFi and VelodromeFi has announced a full merger of the two protocols to create AERO, a next-generation decentralized exchange launching on Ethereum and Circle’s Arc blockchain.

The merger combines two of the most prominent DEXs built on Base and Optimism, setting the stage for a more unified, capital-efficient liquidity layer.

Both Aerodrome and Velodrome have been powerhouses in their ecosystems. Aerodrome operates on Base, Coinbase’s Layer-2 network, while Velodrome has anchored liquidity on Optimism.

Now, they’re joining forces under one banner.

The new platform, AERO, will consolidate the best of both designs. According to Dromos Labs, Aerodrome holders will receive 94.5% of the new token supply, while Velodrome holders will receive 5.5%.

In other words, Aerodrome effectively absorbs Velodrome, turning two liquidity engines into one streamlined protocol. Both $AERO and $VELO tokens will be converted into the upgraded AERO token.

The aim is to eliminate fragmentation between Dromos’ ecosystems and strengthen cross-chain liquidity.

“This is a step toward simplifying DeFi,” one community member wrote. “Instead of two DEXs competing for the same users and liquidity, we’ll have one platform that unites everything.”

AERO will officially launch on Ethereum and Arc, Circle’s newly developed Layer-1 blockchain.

Arc has quickly gained attention as a compliance-ready DeFi network, integrating Circle’s stablecoin infrastructure and fiat on/off ramps. By choosing Arc as one of its launch chains, Dromos Labs is signaling that it sees regulated, transparent DeFi as the future.

Running AERO across Ethereum and Arc bridges the gap between open DeFi and institutional-grade finance, two worlds that have historically remained apart.

Ethereum brings deep liquidity and developer activity. Arc brings speed, compliance, and access to new capital pools. Together, they create the foundation for a hybrid financial network, one where liquidity, governance, and rewards can move seamlessly.

This merger isn’t just a token swap, it’s a strategic move by Dromos Labs to redefine how DEXs grow.

Both Aerodrome and Velodrome were developed in-house by Dromos Labs, each serving as experimental ecosystems for liquidity incentives and governance models.

Velodrome built its success on Optimism’s early DeFi boom, introducing gauge voting and ve-tokenomics to reward long-term participants. Aerodrome followed on Base, adapting similar mechanics to Coinbase’s fast-growing Layer-2.

Now, Dromos wants to take those lessons and combine them into one cross-chain DEX with deeper liquidity, simpler incentives, and broader reach.

The merger creates a single liquidity engine, backed by both communities, governed under one upgraded token.

It’s consolidation done the right way, merging innovation, not killing it.

The token allocation says a lot about where Dromos sees value. Aerodrome, which commands greater liquidity and activity, takes 94.5% of the new supply. Velodrome, still influential but smaller in volume, gets 5.5%.

That balance ensures fair representation without diluting governance efficiency.

The conversion process will be handled through on-chain snapshots, ensuring holders of both tokens receive their new AERO allocations transparently.

The merger effectively retires $VELO and $AERO in their current form, combining them into a single, utility-rich asset that powers the entire AERO ecosystem.

With one governance token, a unified reward structure, and cross-chain liquidity mechanics, AERO aims to become a cornerstone DEX for Ethereum’s next growth cycle.

Circle’s Arc blockchain may prove to be the game-changer here.

Arc is built for regulated on-chain finance, integrating stablecoin settlements, enterprise-level KYC tools, and fast transaction throughput. For Dromos Labs, launching AERO on Arc means tapping into a fresh liquidity base that traditional DeFi protocols often can’t access.

By bridging Ethereum and Arc, AERO positions itself at the intersection of retail DeFi and institutional liquidity.

Analysts believe this approach could set a new standard for how decentralized exchanges operate across multiple layers, blending the speed of modern L1s with the liquidity depth of Ethereum.

The announcement sparked strong reactions across Crypto X, especially from the Aerodrome and Velodrome communities.

Many see the move as a natural evolution rather than a surprise. Both DEXs were built by the same team, shared similar architecture, and served parallel purposes on their respective chains.

One viral post by @zoomerfied captured the sentiment perfectly:

[ ZOOMER ]

AERODROME AND VELODROME TO MERGE INTO ONE PROTOCOL, "AERO" AND LAUNCH ON ETHEREUM AND CIRCLE'S ARC – AERODROME HOLDERS TO GET 94.5% OF THE NEW TOKEN WITH VELODROME HOLDERS GETTING 5.5%: DROMOS CONFERENCE

— zoomer (@zoomerfied) November 12, 2025

Within hours, AERO trended across DeFi circles, with discussions around what the unified token model might mean for future yield strategies and cross-chain governance.

The merger highlights a growing trend, protocol consolidation.

As DeFi matures, projects are realizing that scaling isn’t just about expanding to new chains; it’s about uniting liquidity and users under stronger, simpler models.

With AERO, Dromos Labs is not only cutting redundancy but also building a framework for interoperability that could influence future protocol mergers.

The project’s ability to operate across Ethereum, Optimism, Base, and now Arc positions it at the crossroads of innovation, compliance, and community governance.

If executed well, AERO could set the benchmark for what a next-generation DEX looks like: unified liquidity, cross-chain incentives, and institutional accessibility, all under one ecosystem.

For Dromos Labs, the merger is both symbolic and strategic. Two strong brands, Aerodrome and Velodrome, are becoming one identity built to last.

Instead of managing separate token economies and fragmented liquidity pools, AERO will serve as the central hub for the Dromos ecosystem.

It’s a fresh start for both communities and a signal that DeFi is evolving beyond chain tribalism.

In a space often dominated by competition, AERO represents collaboration, and consolidation with purpose.

As the countdown to launch begins, one thing is clear: AERO isn’t just merging two DEXs. It’s merging the next phase of decentralized liquidity.

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.

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