Velvet DAO is created to ensure that Velvet.Capital becomes a decentralized community-managed protocol by introducing $VLVT - a governance token which provides voting power to token-holders who stake their $VLVT tokens with Velvet. The token utility mechanism is designed to incentivize the best behavior from stakeholders for the greater good of all participants.

Velvet DAO followed principles of progressive decentralization that allowed for lean development, tight execution, and quick learning by the core team in the very early stages, rapidly validating product-market fit and developing the core architecture. As the project has grown further, it's being gradually decentralized bringing and incentivizing contributors from the community.

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