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I have presented an efficient method for velocity optimization using wavefields. The method is automatic because it maximizes the image stack power (or minimizes its negative) and no picking is necessary. The method is extremely fast because it assembles all shot gathers together and migrates them at once, instead of migrating them separately. The shot gathers need to be reassembled with regeneration of random phase-encoding functions at each iteration to mitigate the impact of crosstalk present in the gradient. The encoding strategy can be applied to both land and marine acquisition geometries, regardless of whether or not a fixed receiver spread has been used. Numerical examples demonstrate that encoded simultaneous-source inversion gives reasonably good recovery of the velocity model, with the advantage that the computational cost is independent from the number of sources.