Puffer DAO Report (Epoch 1 & 2)
This Newsletter issue covers Puffer DAO Performance during Epoch 1 (20th-27th January 2025) and Epoch 2 (6th-13th February 2025).
Table of contents
- Governance Recap
- Crypto Markets & PUFFER Analysis
- Staking & Voting Analysis
Puffer Token Analysis
Tokenomics
- Ecosystem and Community: 40%
- Airdrop Season 1: 7.5%
- Airdrop Season 2: 5.5%
- Investors: 26%
- Early Contributors & Advisors: 20%
- Protocol Guild: 1%
The total token supply is 1,000,000,000 and at the time of the token generation event (TGE) the initial supply was 102,300,000 (10.23%).
Utility
PUFFER gains utility through staking, by allowing users to lock PUFFER to receive vePUFFER, users can participate in bi-weekly gauge votes. These votes determine how CARROT rewards are distributed across liquidity providers, developers, and ecosystem initiatives. By actively staking and voting, users can earn yield through community-driven rewards, making PUFFER active and valuable within the protocol.
CARROT tokens earned will eventually be proportionately convertible into PUFFER, reinforcing long-term engagement and incentivizing our community.
CARROT Token
With a total supply of 100M tokens, the CARROT token is an ERC20-compatible rewards token that has replaced point incentives in the Season 2 update. Epoch 1 allocated 1.4M tokens, Epoch 2 had 3M, this trend will continue as the CARROT allocation per Epoch is not static, and a dynamic distribution introduces the opportunity to increase rewards proportionally depending on different factors, e.g. engagement, etc.
Governance Recap
January 2025 saw the introduction of Puffer’s Season 2 update, which brought incentives on-chain. Some of the key statistics as part of this initiative:
- Four incentive proposals were submitted to the governance forum
- Over 464,000 votes were cast on gauges within the first 24 hours of Epoch 1.
- At the beginning of January, the total staked PUFFER tokens amounted to 2,203,585. By Epoch 2, the staked amount has grown significantly to 5,069,646, representing a 130% increase.
- Epoch 2 had a total of 1.93M votes cast, up 176% from 713,000 votes in Epoch 1.
Daily New Stakers & Total Stake
Incentive Proposals
The four incentive proposals that were submitted on the forum were as follows:
January:
- Venus Protocol — Venus pufETH collateral market — Ethereum Mainnet Venus Protocol was seeking to add pufETH as a collateral asset to their multi-chain lending platform.
- Ocelex Protocol — PufETH/WETH Ocelex Incentives on ZircuitOcelex Protocol proposes to establish a pufETH/WETH liquidity pool on Zircuit chain, utilizing their Automated Liquidity Managers (ALMs) and ve33 token model to optimize concentrated liquidity returns Elara Protocol — PufETH-WETH Pool incentive on Elara (Zircuit)
Elara, the leading lending protocol on Zircuit, proposes establishing a pufETH lending pool with supply-based incentives
- Fugu NFT — Incentive Proposal for Fugu NFT CommunityFugu NFT proposes launching the first NFT collection on Puffer Finance, consisting of 10,000 hand-drawn Fugu NFTs that will grant holders community access and potential rewards
February:
- SONEX — Incentive Program on SONEX
SONEX is a leading decentralized finance (DeFi) platform built on the Soneium ecosystem, dedicated to providing innovative financial solutions through features like liquidity mining, single token staking, and loop lending.
- Sake Finance— Sake Finance — PufETH Lending and Borrowing pool
We propose introducing incentives for users who supply pufETH to Sake. With pufETH preparing to onboard to Soneium, this partnership presents a valuable opportunity to unlock liquidity and drive growth within the Puffer ecosystem.
- TermMax—Incentive Proposal for TermMax
TermMax, developed by Term Structure Labs, is an innovative DeFi protocol that combines a customizable Uniswap v3 AMM model with fixed-rate, fixed-term borrowing and lending.
Stake & Voting Analysis
Following the launch of the $CARROT token and incentive gauges, Epoch 1 saw an uptick in PUFFER holders staking to take part in the gauges:
Epoch 1
- 3,350,973 total staked PUFFER
- 2,349,772 total vePUFFER voting power
- 1717 Unique PUFFER stakers
Epoch 2
- 5,069,646 total staked PUFFER
- 5,319,580 total vePUFFER voting power
- 1828 Unique PUFFER stakers
The surge in staking is most likely due to the523.56% APR from the PUFFER — vePUFFER gauge pool in Reward Epoch 1. Even with the 130% increase in stakers, the PUFFER — vePUFFER gauge provides 474.48% APR.
Conclusion
Our first two epochs of 2025 have shown strong growth and engagement from our community.
Performance Highlights:
- Staking participation increased significantly, with total staked PUFFER growing 130% from 3.35M to 5.07M tokens
- The voting engagement saw a 176% increase from Epoch 1 to Epoch 2, with total votes rising from 713,000 to 1.93M
- The gauges introduced attractive incentives, with the PUFFER — vePUFFER gauge maintaining a high APR above 474%
- Active governance participation resulted in multiple strategic partnerships across lending and liquidity protocols
By introducing the Season 2 update and the CARROT token we’ve revamped our incentive structure, which has driven participation and established a foundation for sustainable growth. The dynamic CARROT allocation model provides scaling flexibility, while the conversion mechanism to PUFFER at the end of Season 2 promotes long-term alignment.
About Puffer Finance
Puffer Finance is a leading innovator in Ethereum infrastructure, focusing on next-generation rollups supported by liquid restaking (LRT) and preconfirmation as an AVS. With products like Puffer UniFi and Puffer UniFi AVS on EigenLayer, we are dedicated to enhancing Ethereum’s decentralization. Visit puffer.fi for more information.