Velocity templates were deprecated in Liferay Portal 7.0 and are now removed in favor of FreeMarker templates in Liferay DXP 7.0. Below are the key reasons for this move:
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FreeMarker is developed and maintained regularly, while Velocity is no longer actively being developed.
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FreeMarker is faster and supports more sophisticated macros.
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FreeMarker supports using taglibs directly rather than requiring a method to represent them. You can pass body content to them, parameters, etc.
Although Velocity templates still work in Liferay DXP 7.0, we highly recommend migrating to FreeMarker templates. For more information on this topic, see the Upgrading Layout Templates section.