Puffer Finance, a project developed on the Ethereum restaking platform Eigenlayer, has successfully raised $18 million in a Series A funding round to launch its mainnet. The round was led by Brevan Howard Digital and Electric Capital, with investments from Coinbase Ventures, Kraken Ventures, Lemniscap, Franklin Templeton, Fidelity, Mechanism, Lightspeed Faction, Consensys, Animoca, GSR, and other angel investors. After completing its early test phase in February, Puffer Finance quickly reached a total value locked of $1.2 billion. The protocol has now raised a total of $23.5 million in venture capital funding. Binance Labs has also made a strategic investment in Puffer Finance following this funding round.
Puffer Finance’s technology enables Ethereum validators to reduce their capital requirement from 32 ETH to just 1 ETH. Users who stake their Ether through Puffer Finance receive Puffer liquid restaking tokens (nLRTs), which can be utilized for farming yields in other decentralized finance protocols while also earning Ethereum staking rewards. This process, known as liquid staking, has been widely used by other blockchains like Cosmos and has recently been introduced to Ethereum after the network transitioned to a proof-of-stake model.
Amir Forouzani, a core contributor at Puffer Labs, stated that their goal is to lower the barriers for home validators to participate in staking and provide the most advanced liquid restaking protocol. Previously, EigenLayer surpassed the popular DeFi lending protocol Aave in terms of total value locked (TVL), with $10.4 billion worth of cryptocurrencies committed to the protocol. Dune Analytics data reveals that EigenLayer has more than 107,900 unique depositors, and DefiLlama statistics show that 74% of staked tokens are Wrapped Ether (wETH) and stETH.
Liquid staking protocols are currently the largest category in the DeFi space, with approximately $55 billion in locked value across around 160 protocols. Lido is the leading protocol in terms of locked value, with $35 billion.
The concept of earning staking rewards while farming yields in other DeFi protocols is simply genius. Puffer Finance is onto something big!
Kudos to the team at Puffer Labs for developing such an advanced liquid restaking protocol. Lowering the barriers for home validators is a game-changer! 🏆💪