Puffer Finance, a project that utilizes the Ethereum restaking protocol EigenLayer, has successfully raised $18 million in a Series A funding round to launch its mainnet. This funding round was led by Brevan Howard Digital and Electric Capital, with contributions from Coinbase Ventures, Kraken Ventures, Lemniscap, Franklin Templeton, Fidelity, Mechanism, Lightspeed Faction, Consensys, Animoca, GSR, and other angel investors.
According to DefiLlama data, shortly after its initial test phase in February, Puffer Finance exceeded a total value locked (TVL) of $1.2 billion. Thus far, the project has raised a total of $23.5 million in venture capital funding.
In its announcement, Puffer Finance stated that following this funding round, it secured a strategic investment from Binance Labs, which strengthens its position within the Liquid Restaking ecosystem. The project also hinted at upcoming technological advancements alongside the launch of its mainnet.
Puffer Finance’s technology enables Ethereum validators to reduce their capital requirement to just 1 Ether (ETH), as opposed to the 32 ETH typically required for individual stakers. Additionally, users who stake Ether via Puffer Finance receive Puffer liquid restaking tokens (nLRTs), which can be used to earn yields in other decentralized finance protocols simultaneously with their Ethereum staking rewards. This process, known as liquid staking, has been previously practiced by other blockchains like Cosmos and has recently transitioned to Ethereum after the Merge upgrade.
Amir Forouzani, a core contributor at Puffer Labs, expressed the project’s goal of reducing barriers for home validators to participate while delivering the most advanced liquid restaking protocol.
Earlier this month, EigenLayer surpassed decentralized finance lending protocol Aave in TVL, with $10.4 billion worth of crypto committed to the protocol after temporarily removing a staking limit. Dune Analytics data reveals that EigenLayer has over 107,900 unique depositors, with DefiLlama statistics indicating that 74% of staked tokens are Wrapped Ether (wETH) and Lido Staked Eth (stETH).
Currently, liquid staking protocols represent the largest category in the DeFi space, with approximately $55 billion in locked value across around 160 protocols. This growth is primarily driven by Lido, the largest protocol in terms of locked value, with $35 billion.
In related news, the restaking protocol EigenLayer has partially launched on the Ethereum mainnet.