The TVL of Ethereum liquid staking has surpassed $51 billion, and competition is becoming more fierce as time goes on.
Electric Capital and Brevan Howard Digital led a Series A fundraising round of $18 million for the EigenLayer restaking-based liquid staking project Puffer Finance on Ethereum. Puffer Finance’s liquid staking solution will reach a major milestone with the launch of its mainnet, made possible by the funding.
Coinbase Ventures, Kraken Ventures, Lemniscap, Franklin Templeton, Fidelity, Mechanism, Lightspeed Faction, Consensys, Animoca, and GSR were among the notable investors that took part in the investment round. Binance Labs’ strategic investment and the Series A round both solidified Puffer Finance’s position as a leading player in the liquid restaking ecosystem.
Puffer Finance said that it has received a strategic investment from Binance Labs “after this round,” which will strengthen Puffer’s position in the liquid restaking ecosystem.
Even though the protocol didn’t go into detail about the improvements, it did hint at “technical enhancements” that would be coming after the mainnet debut.
One Ethereum (ETH) is all that’s needed to become an Ethereum validator, thanks to Puffer Finance’s innovation. This makes it much easier for ordinary stakeholders to get in on the action. On top of that, users may farm yields in other decentralized finance (DeFi) protocols using their Puffer liquid restaking tokens (nLRTs), which they obtain when they stake Ethereum via Puffer Finance.
After Ethereum moved to proof-of-stake (PoS) consensus, liquid staking—which lets users stake their assets while keeping them liquid via tradable ERC-20 tokens—became popular among Ethereum holders. The goal of Puffer Finance is to improve the efficiency and accessibility of liquid staking for Ethereum users.
According to data from DeFiLlama, Puffer Finance’s total value locked (TVL) came close to $1.2 billion not long after its early test phase ended in February, showing that its liquid staking solution was in high demand. Venture capitalists have put up a combined $23.5 million into the protocol so far.
Amir Forouzani, a key member of Puffer Labs’ team, highlighted the project’s objective by saying, “Our goal is to offer the most sophisticated liquid restaking protocol while also drastically lowering the obstacles for home validators to participate.”
Lido Finance, Ethereum’s biggest liquid staking system, has been a major force in the market’s meteoric rise, with a TVL already exceeding $51 billion. With over 9.78 million ETH invested on the platform, Lido Finance has a TVL of over $11 billion as of March 2024.
The ability to use staked assets in DeFi apps is just one of many advantages that liquid staking brings to Ethereum users, who can also diversify their revenues, reduce risk, increase capital efficiency, strengthen network security, and promote decentralization. Projects like Puffer Finance strengthen the Ethereum network as a whole by letting more users stake their ETH.
Also Read: Adidas and STEPN introduce their collaborative NFT footwear
Wallets