This article does not cover the basics of Berachain. If this is your first time learning about Berachain, it is recommended to read “Explore Berachain: Liquidity and Security in the Palm of Your Hand 🐻” and continue reading this article.

The protocol links included in this article may be deleted or modified after the mainnet launch, so please be cautious when accessing and using these links.

1. Introduction

Berachain is a Layer 1 network characterized by the PoL (Proof of Liquidity) consensus mechanism, which aligns the interests of validators, liquidity providers, and protocols. Currently, Berachain is in the process of launching its second testnet, the “bArtio Testnet,” to address issues discovered in the first testnet.

Many ecosystem protocols have already been deployed on the bArtio Testnet. As of January 2nd, according to Berachain’s official website, a total of 234 protocols are participating in the bArtio Testnet. The number of wallets testing Berachain’s PoL mechanism has exceeded 2.38 million. Even though it is still in the testnet phase, these figures indicate a high level of market attention towards Berachain and its ecosystem.

bArtio Testnet Cumulative Wallet Trend; Source: bArtio Explorer

Since the end of 2024, Berachain founder Smokey The Bera, who introduced the “Q5 Mainnet Launch” timeline, recently shared a tweet on X about Boyco, suggesting that “Q5 will happen before April,” indicating that the mainnet launch is imminent. This has attracted both new and old users to join the Berachain ecosystem.

However, to participate in the Berachain ecosystem, users must understand its PoL mechanism. Before the mainnet is launched, the various complex financial products that protocols have introduced to gain an advantage in the PoL mechanism have instead created a significant entry barrier for new users.

This article aims to explore different areas of the Berachain ecosystem to effectively lower the participation threshold for users. We will discuss projects that have stood out in various areas and provide details on how each protocol leverages the PoL mechanism.

2. DEX

Berachain has a native decentralized exchange (DEX) called BEX, which will launch on the mainnet as BeraSwap. BeraSwap will support smooth liquidity trading within the ecosystem and ensure the effective operation of the PoL mechanism. Given the presence of BEX, other DEXs preparing to launch on Berachain are also working on various more convenient and efficient services and strategies to effectively compete with BEX, attracting users and liquidity.

2.1. Kodiak

Kodiak is a DEX that emerged from Berachain’s incubation project “Build a Bera.” In addition to supporting the Uniswap v2-style functionality of BEX (distributing liquidity evenly across the entire price range), Kodiak also provides a feature similar to Uniswap v3’s CLAMM (Concentrated Liquidity Automated Market Maker). This allows liquidity providers to set and concentrate liquidity within a specific price range.

Kodiak CLAMM Pool Deposit Interface; Source: Kodiak

Users can provide liquidity in a narrow range through the CLAMM pool to more effectively farm $BGT. Additionally, Kodiak offers an “Island” feature that helps users automatically reset and balance the CLAMM range, reducing the hassle of managing liquidity supply positions. This feature uses BEX to rebalance liquidity, thus creating a complementary relationship rather than a competitive one.

Moreover, due to the customizability of the liquidity range, CLAMM liquidity positions’ tokens are typically hard to use in other protocols. However, Kodiak standardizes the user’s CLAMM liquidity positions through the Island feature, allowing the LP tokens to be used in other protocols, promoting more flexible and diverse ecosystem interactions.

Before the mainnet launch, Kodiak has already partnered with many projects within the Berachain ecosystem, establishing itself as a core infrastructure provider. It also operates its own Berachain node as a validator node, and as of January 3rd, it had received the second-highest BGT authorization in the bArtio Testnet.

2.2. Honeypot Finance

Honeypot Finance is a protocol that supports all aspects of a token’s lifecycle, from issuance to liquidity provision and efficient trading. It consists of the following sub-protocols:

• Henlo DEX: A DEX specifically designed to protect users from MEV (Maximal Extractable Value) attacks. It offers limit orders and Batch-A2MM functionality, which collects user orders over a specific period and executes them at the same price.
• Dreampad: A Launchpad protocol that provides incubation and funding opportunities for projects preparing to launch on Berachain, while ensuring fair token launches and distributions.
• Pot2Pump: A meme coin sale platform that offers a safer environment for meme coin issuance and trading. It has features like protection against bot sniping and refunds to participating users if fundraising goals are not met within 24 hours.

Similar to Kodiak, Honeypot Finance plans to operate as a validator node after the mainnet launch, offering its governance token $HPOT as staking rewards to users who delegate $BGT.

Furthermore, Honeypot Finance utilizes accumulated $BGT to release into the $HPOT liquidity pool, enhancing $HPOT liquidity. The protocol also plans to increase token value by using node operation revenue to buy and burn $HPOT, while retaining the reward value paid to $BGT delegators, further solidifying $HPOT liquidity.

3. Liquidity Staking

In typical PoS (Proof of Stake) networks, network rewards are distributed to validators who hold a certain amount of tokens and operate nodes. Therefore, if the network itself does not have an authorization structure for native tokens, general users who do not operate nodes are unable to earn network rewards.

To address this issue, liquidity staking protocols distribute rewards by accepting native tokens for staking and delegating node operations, allowing regular users to participate in network staking. These protocols also issue LP tokens to stakers as proof of how many native tokens they hold, which in turn enhances ecosystem liquidity. Through these functions, liquidity staking protocols have become a core infrastructure for PoS networks.

In contrast, although Berachain’s node operations require 69,420 $BERA tokens, its structure is designed so that when liquidity providers deposit liquidity tokens they receive from ecosystem protocols into Berachain, they earn network rewards in $BGT and liquidity-providing interest. Therefore, while the method and sequence differ, Berachain has essentially built liquidity staking directly into its network protocol.

Similarly, although Berachain’s node operations on the mainnet will require 250,000 $BERA tokens, the structure of Berachain will distribute $BGT rewards and interest to liquidity providers. Thus, aside from differences in method and order, Berachain has essentially integrated liquidity staking into the network protocol.

However, in Berachain, existing protocols can only offer rewards and gain voting rights by collaborating with validators, or, as demonstrated by Kodiak and Honeypot Finance, by operating their own nodes to establish a self-sustaining flywheel model for launching their liquidity pools.

In this context, Berachain’s liquidity staking protocols will provide a redemption function for $BGT (which determines emission voting rights). This allows Berachain ecosystem projects to incorporate liquidated $BGT into their protocol mechanisms without the need to negotiate with validators or node operators. In other words, this makes it easier for ecosystem protocols to adopt a structure tightly integrated with the PoL mechanism.

3.1. Infrared

Infrared is a liquidity staking protocol jointly incubated with Kodiak through Berachain’s “Build a Bera” program.

The storage vaults operated by Infrared can accept LP tokens from liquidity pools, generate $BGT interest, and simultaneously run network nodes. When users deposit LP tokens into these storage vaults, Infrared uses these tokens to generate $BGT, and users receive $iBGT (liquidated $BGT) proportional to the LP tokens they deposited.

Infrared Dashboard; Source: Infrared

Users can utilize the received $iBGT in the following ways:

• Stake in Infrared to earn rewards generated by the nodes.
• Use in other DeFi protocols.
• Sell for profit.

Therefore, by making $BGT a liquid token, Infrared concentrates and distributes the rewards generated by the PoL mechanism to fewer $iBGT stakers. This also helps other protocols within the Berachain ecosystem integrate $iBGT into their mechanisms, allowing their platforms to offer higher yields to their users. In addition, Infrared plans to introduce new features that will allow them to receive and liquidate the $BERA required for node operations while running nodes and distributing profits.

The best example of effectively utilizing Infrared’s features is Kodiak’s Island Pool, which was briefly introduced in the DEX section above. After the mainnet launch, Infrared plans to introduce Kodiak’s Island Pool (already operational on the testnet), allowing users to more efficiently farm $iBGT using Kodiak’s CLAMM. Users can then either re-stake the received $iBGT in Infrared, or deposit it back into Kodiak’s $iBGT/$BERA Island Pool for further $iBGT farming. Of course, users can also choose other strategies within the ecosystem.

Based on the protocol’s interconnectivity and effective ecosystem interactions, Infrared has already attracted significant user attention. It currently receives the most $BGT delegation in the bArtio Testnet. Additionally, many ecosystem projects have partnered with Infrared and plan to launch various derivative products, indicating that Infrared will be one of the most important infrastructures once the mainnet is launched.

Infrared Ecosystem Map; Source: Infrared Blog

At the same time, the specific details regarding how Infrared will use delegated $BGT to select $BGT emissions have not yet been disclosed. Therefore, it will be crucial to closely monitor whether Infrared will implement these processes in a decentralized manner and who will be granted the voting rights for its held $BGT.

3.2. BeraPaw

BeraPaw is also a liquidity staking protocol, but instead of running its own nodes, it operates vaults between different nodes and liquidity pools registered in BeraPaw, issuing $LBGT as the liquidation token for $BGT.

BeraPaw’s governance token is $PAW, and users can use the $BGT held by BeraPaw to vote on which liquidity pools should receive $BGT. Node operators distribute the rewards generated by staked $BGT to $LBGT holders through this method.

BeraPaw Protocol Structure; Source: BeraPaw Docs

The structure adopted by BeraPaw divides the uses of the $BGT token into two tokens: $LBGT and $PAW. 1) To receive rewards, and 2) To vote for the $BGT emission pools. Through this structure, users and protocols that use $PAW tokens to vote on $BGT emissions can exercise more voting power with relatively less capital. Therefore, protocols seeking initial liquidity in the Berachain ecosystem are expected to actively use $PAW to generate $BGT rewards for their liquidity pools.

The above describes two liquidity staking protocols that are preparing for their official launch on Berachain. While these protocols not only bring more derivative products but also provide users with more options, they also make the ecosystem more complex. In the Berachain network, the power and position of nodes will be proportional to the amount of delegated $BGT. Liquidity staking protocols offering $BGT liquidation functionality are expected to be adopted by many users and protocols, becoming core infrastructure.

4. Lending

Berachain also has a native lending protocol, BEND, which offers the following features:

• Use $WBTC, $WETH as collateral to borrow $HONEY.
• Deposit $HONEY.

Unlike typical lending protocols, BEND has two notable characteristics:

1. $HONEY cannot be used as collateral.
2. $WBTC and $WETH deposits do not generate interest, but when borrowing $HONEY, users earn $BGT rewards.

In BEND, $BGT can be claimed for borrowed $HONEY; Source: BEND

Through this structure, BEND strengthens Berachain’s triple-token economic structure by generating basic interest for $HONEY, while increasing lending demand via $BGT and enriching the ecosystem’s liquidity. Users can also engage in $BGT leveraged farming by repeatedly swapping borrowed $HONEY for $WETH, $WBTC, and depositing it into BEND.

Next, we will explore in detail some of the main lending protocols preparing for launch on Berachain and the features they offer.

4.1. BeraBorrow

BeraBorrow is an over-collateralized stablecoin issuance protocol where users can mint the $NECT stablecoin. It not only allows common assets like $BERA and $HONEY as collateral but also allows BEX and Berps LP tokens, as well as Infrared’s $iBGT, as collateral assets. The $NECT minted from collateral assets can be deposited into BeraBorrow’s liquidity stability pool. Depositors can collect borrowing fees and liquidation fees from $NECT borrowers, establishing a structure that supports the fundamental demand for $NECT.

In addition to $NECT, BeraBorrow also has a governance token, $POLLEN, which serves as an incentive token in the following ways:

Rewarding liquidity pools that receive $BGT emissions.

Encouraging collateral deposits into liquidity pools with high $NECT debt.

Rewarding depositors in liquidity stability pools.

Beyond this basic structure, LP tokens deposited into BeraBorrow are automatically stored in Infrared to generate $iBGT rewards, and these rewards are automatically re-deposited in Infrared for compound interest. Users can borrow $NECT to provide liquidity on other protocols and deposit the LP tokens received back into BeraBorrow to establish leveraged positions.

Moreover, BeraBorrow plans to allocate $BGT to DEX liquidity pools for $NECT and $iBGT trading, enhancing the demand and market liquidity for $NECT, while providing high deposit yields for liquidity providers.

BeraBorrow’s Flywheel Structure; Source: BeraBorrow Docs

With demand support across various channels, $NECT is expected to become the core native stablecoin within the Berachain ecosystem alongside $HONEY.

4.2. Gummi

Gummi is a lending protocol incubated through the “Build a Bera” initiative that operates without the need for an oracle, allowing anyone to create lending pools without restrictions. Using this structure, Gummi plans to leverage any assets within Berachain to offer users the ability to create leveraged positions of up to 100x.

Before the mainnet launch, Gummi has already formed partnerships with core infrastructures such as Infrared and Kodiak, and plans to support leveraged farming positions for $iBGT and various LP tokens from Kodiak.

This indicates that, unlike lending protocols in other networks primarily used for specific asset leverage and hedging positions, Berachain’s lending protocols will amplify the $BGT emissions generated by the PoL mechanism. As more protocols launch on Berachain and the ecosystem diversifies, the utility and demand for lending protocols are expected to increase, making them a vital part of the ecosystem.

5. Derivatives Protocols

Currently, various derivative protocols that utilize the PoL mechanism in different ways are also preparing to launch on Berachain. The basic infrastructure includes Berps, which is a native perpetual DEX that the Berachain team will launch alongside BEX and BEND.

Berps Interface; Source: Berps

In Berps, users can create 100x leveraged positions on various assets using $HONEY, or they can deposit $HONEY to provide liquidity for traders’ positions, earning transaction fees, funding fees, and $BGT as rewards.

Through this structure, Berps gives $HONEY a clear use case as the base asset for Berachain’s native Perp DEX, while also providing a simple yet effective entry point for $BGT Farming. This allows new users, who may find the PoL mechanism intimidating, to earn $BGT rewards through a single $HONEY deposit. As such, the protocol is expected to become one of the most crucial protocols supporting Berachain’s triple-token economy.

Next, let’s look at some unique derivative protocols that are preparing to launch on Berachain.

5.1. SMILEE

SMILEE is an options protocol that enables the creation of hedged positions for DEX liquidity providers. The options created within SMILEE feature a unique structure that generates more profit during periods of high price volatility, essentially counteracting the effects of impermanent loss (IL), which typically results in liquidity providers incurring larger losses during high volatility.

To create an options position within SMILEE, users must pay a certain premium. There are three types of options positions available:

• Bull: Bets on significant upward price volatility until expiry.
• Bear: Bets on significant downward price volatility until expiry.
• Smile: Bets on substantial price movement in either direction (up or down) until expiry.

WBTC Smile Option Product; Source: Smilee

In addition to these types of options trading, users can also provide liquidity to the options positions created by traders and earn the option premiums paid by traders. While liquidity providers face impermanent loss (IL) equal to the profits made by traders, similar to providing liquidity to a DEX, SMILEE reduces liquidity providers’ impermanent loss by offering real-time rebalancing of liquidity positions whenever an options trade occurs.

The Berachain network protocol is expected to create liquidity pools on major DEXs (including the native dapp BEX) to increase the liquidity of its tokens and generate $BGT rewards for these pools. In this environment, we can estimate that liquidity providers and protocols mining $BGT will widely use SMILEE as a hedging tool for their LP positions. Furthermore, if SMILEE options positions begin to receive $BGT Emission in the future, SMILEE’s position within the Berachain ecosystem will become even more solidified.

5.2. Exponents

Exponents is another derivative protocol that uses its own reverse asset issuance protocol, IBC (Inverse Bonding Curve), to enable leveraged positions across all assets within the ecosystem that cannot be liquidated.

IBC adopts a reverse Bonding Curve, which is the opposite of the traditional Bonding Curve concept. The Bonding Curve mechanism has been adopted by many meme coin launchpads (e.g., Pump.fun) as a price discovery mechanism. Traditional Bonding Curves work by reducing the required asset quantity and driving the price up as more collateral assets are added to the liquidity pool. In contrast, IBC enables reverse assets, where the price decreases as demand increases. As more collateral assets are deposited, the number of receivable assets also increases.

BC Graph; Source: IBC

Exponents uses the IBC mechanism to implement both long and short positions for all assets without the need for oracles. The goal is to adjust the parameters of the IBC mechanism to steepen the Bonding Curve, thus providing leveraged positions without liquidation risk.

Additionally, IBC also facilitates the staking of synthetic assets issued by the protocol and distributes profits generated by the protocol. When combined with Berachain’s PoL mechanism, $BGT Emission can be distributed as rewards to users who issue assets through IBC. In other words, by using $BGT as a reward, users are encouraged to establish short positions on competing protocol tokens, further diversifying the ecosystem’s gameplay.

In addition to SMILEE and Exponents, various derivative protocols are also preparing to launch on Berachain, including IVX, which allows for low-cost establishment of short-term high-leverage positions through a 0-DTE feature, and Polarity Finance, which provides loans using options as collateral. Compared to derivative tools in other blockchain ecosystems, each of these derivatives is more diverse and complex. Some protocols complement Berachain’s PoL mechanism, while others leverage the mechanism to highlight their unique advantages.

6. Other Protocols

So far, we’ve explored several foundational protocols in the blockchain ecosystem (including DEX, liquid staking, lending, and derivatives), discussing how these projects leverage the PoL mechanism to highlight their unique advantages within Berachain.

However, aside from the DeFi sector we’ve covered, various types of projects are also preparing to launch on Berachain. Some of these projects adopt Berachain’s unique structure and actively utilize the PoL mechanism, while others may not directly implement it but achieve high synergy with the ecosystem. There are also projects that align with Berachain’s cultural values and focus on their unique features to attract user interest and attention.

Next, we will introduce some of these distinctive projects that are set to launch on Berachain.

6.1. Goldilocks

Goldilocks is a DAO and platform designed to develop Berachain’s exclusive DeFi infrastructure. It consists of the following sub-protocols:

• Goldiswap: Includes a Floor Supporting Liquidity Pool (FSL) that ensures a minimum price for Goldilocks’ governance token, $LOCKS, and a Price Supporting Liquidity Pool (PSL) used for trading $HONEY and $LOCKS. This structure continuously increases the minimum price of $LOCKS by collecting fees generated from trading in the PSL pool. Users can stake $LOCKS to earn $PORRIDGE as a reward. $PORRIDGE grants users the right to purchase $LOCKS at the minimum price. Users can also use $LOCKS as collateral to borrow $HONEY.

Goldilocks DAO Interface; Source: Goldilocks DAO

• Goldilend: This is an NFT collateral lending protocol within the Berachain ecosystem.
• Goldivaults: Utilizes assets with time-locks stored within Berachain’s DeFi protocols to generate interest. Depositors receive OT (Ownership Tokens), which grant the right to claim the principal at maturity, and YT (Yield Tokens), which grant the right to claim the interest earned. This allows users to trade future interest income, similar to Pendle Finance on Ethereum (for more details on this feature, refer to the article “Pendle Finance - Discovering Undeveloped Markets”).

Thus, Goldilocks offers Berachain-optimized services such as NFT collateral lending and interest trading, making NFTs and liquidity provision play a more significant role compared to other ecosystems. Additionally, Goldilocks is expected to gradually ensure more users and liquidity by raising the price structure of its platform tokens and leveraging the lending services tied to this token.

Meanwhile, Pendle Finance, which has become a core DeFi protocol widely adopted within the Ethereum ecosystem, uses YT tokens to distribute protocol points for liquidity deposits, promoting airdrop activities. Similarly, whether Goldilocks can establish dominance within the Berachain ecosystem by creating various types of Goldivaults in collaboration with other projects issuing tokens will be an exciting point of focus.

6.2. Beradrome

Beradrome is a protocol that aggregates liquidity tokens from users and distributes the generated profits, as well as negotiated rewards from other protocols, back to users. Beradrome uses three native tokens to internalize profits generated within the protocol:

• $oBERO: A token that rewards users who deposit liquidity tokens into Beradrome. By burning $oBERO, users can vote on the $oBERA reward emission rate within liquidity pools or deposit an equivalent amount of $HONEY to mint and receive $BERO.
• $BERO: The primary token of Beradrome. Since $HONEY deposited during minting is burned alongside $oBERO, the value of $BERO is guaranteed to remain above 1 $HONEY.
• $hiBERO: The governance token of Beradrome, which can be obtained by staking $BERO. Users can use $BGT held by Beradrome to vote on which liquidity pools should receive $oBERO and to earn profits generated by the protocol. $hiBERO can also be used as collateral to borrow $HONEY.

Through the $BERO minting mechanism with $oBERO, Beradrome incentivizes the internalization of rewards generated within the protocol, keeping the price of $BERO and $hiBERO above 1 USD. Additionally, it offers liquidation-free lending opportunities for $HONEY deposited during the $BERO minting process, benefiting $hiBERO holders. This will continuously attract external liquidity into the protocol and encourage more protocols to develop liquidity via Beradrome, creating a self-sustaining flywheel that redistributes rewards to users.

Moreover, Beradrome plans to operate its own nodes and acquire $BGT Emission voting rights by accepting external $BGT delegation. This separation from the protocol’s operational mechanism would allow the distribution of $BGT to the $hiBERO minting pool. If this plan succeeds, $hiBERO holders could simultaneously benefit from both Beradrome’s profits and $BGT, potentially attracting more liquidity to the Beradrome ecosystem.

Beradrome’s Incentive Flow; Source: Beradrome Docs

6.3. Yeet

Yeet is an on-chain betting game protocol using $BERA. Anyone can participate in the game by betting $BERA in the Yeet liquidity pool during the set game period (with each new deposit needing to be approximately 0.5% higher than the previous bettor’s deposit). The last user who deposits $BERA in the pool wins and takes 80% of the total $BERA in the liquidity pool.

Even if users don’t win the game, they will receive $YEET, the native token of Yeet, as a reward proportional to their betting amount. Users can then stake the $YEET tokens they received in Yeet’s Liquidity Trifecta Vault to earn betting interest.

The Liquidity Trifecta Vault takes 9% of the $BERA and $YEET tokens that users have deposited during the game. These assets are then used to provide liquidity to Kodiak, and the liquidity tokens received from Kodiak are re-staked in Beradrome, maximizing the interest paid to investors.

Yeet Liquidity Flow; Source: Yeet Docs

Additionally, Yeet plans to launch the YeetBond feature, allowing users to purchase bonds for specific tokens at a discounted price based on the market price at maturity. In the Berachain ecosystem, there are various methods for creating future value through liquidity, and the YeetBond feature is expected to be actively utilized by different protocols as a tool for ensuring liquidity.

Thus, Yeet plans to offer Berachain both “fun features” and “effective features,” aiming to build a strong community starting from the testnet phase. The community will be centered around its unique, joyful, meme-driven culture, and will include Yeetard NFTs that provide $YEET reward enhancements.

6.4. Ramen

Ramen is a Launchpad protocol, similar to Honeypot Finance’s Dreampad, designed to help new projects launching on Berachain promote themselves and safely raise funds through fair token sales. The platform supports two types of Launchpad modes:

• Fixed Price Mode: In this mode, users can purchase tokens at a fixed price. To participate in the launch, users must either be on a whitelist or stake the platform’s native token, $RAMEN, as a bet to obtain Gacha tickets. These tickets can then be consumed for a chance to win in a lottery.
• Price Discovery Mode: Unlike the fixed price mode, this mode allows anyone to participate. Users looking to purchase tokens must make blind bids based on the price of the desired token, multiplied by the amount they wish to buy. The settlement price is determined through this bidding process, with the right to purchase tokens at the final price granted first to the highest bidder.

Price Discovery Mode’s Price Discovery Method; Source: Ramen Docs

In addition to the Launchpad functionality, Ramen plans to launch Airdrop Recipes, which makes it easier to set and execute token airdrop standards. Ramen will provide all the necessary features, from token issuance to sales and distribution, with the goal of becoming a core infrastructure platform adopted by many new projects once Berachain’s mainnet goes live.

However, in order for Ramen to maintain user interest, it needs certain protocol-dependent features. The projects using Ramen to sell tokens must be successfully operating and provide profits to the token buyers. Therefore, it will be crucial to continue monitoring the long-term growth of projects utilizing Ramen for token sales, and whether any promising projects choose to use its platform for their token issuance.

6.5. PuffPaw

PuffPaw is a Vape 2 Earn project, allowing users to earn tokens through vaping. The project uses a self-made smoking device and nicotine cartridges to measure users’ smoking activity. It rewards users with higher amounts of $VAPE tokens when they use lower-nicotine liquid, incentivizing a reduction in smoking. This approach encourages users to quit smoking while still participating in the ecosystem.

Additionally, through its Leasing-Borrowing program, users who do not want to smoke but still wish to participate in the project can lend their devices to users who cannot afford them. This creates a structure that attracts Berachain ecosystem users, whether or not they smoke.

PuffPaw’s Vaping Device; Source: @puffpaw_xyz

In December 2023, PuffPaw’s PUFF PASS NFT was successfully sold out as an entry ticket for the project. The company plans to strengthen its Vape brand image and expand its ecosystem through additional device sales. PuffPaw also aims to generate extra income by providing device usage data to AI companies and insurance firms, helping to support the value of $VAPE tokens distributed as rewards. The project also plans to develop methods that use the PoL mechanism to generate additional income for $VAPE holders.

PuffPaw Flywheel; Source: PuffPaw Whitepaper

At this point, we’ve explored various protocols on Berachain that represent different sectors, each with its unique advantages. Additionally, there are projects that allow participation in the Berachain ecosystem without the need to understand its liquidity mechanisms:

Beratone: Life simulation, role-playing game

Junky Ursas: GambleFi platform

Fable: Decentralized media/gaming platform

Onikuma: On-chain SocialFi platform

Moreover, various vault/on-chain fund protocols, including Dirac Finance, NAV, and D2, are set to launch, simplifying various DeFi strategies within the ecosystem. These projects are designed to make it easier for new users to engage and profit with simple risk management tools.

These protocols not only encourage more users to join the Berachain ecosystem, increasing overall liquidity, but they also help promote and expand the ecosystem’s use.

7. Community

Most protocols within the Berachain ecosystem adopt structures that aim to attract initial liquidity by offering high rewards to liquidity providers. These protocols leverage the PoL mechanism, and utilize NFTs and Memes to build communities, which further strengthens and expands these structures.

Since the PoL mechanism grants users with more $BGT and liquidity greater negotiation power and access to more incentives, some projects focus on first building communities through NFTs and Memes. They establish reputation and status within the community, and later, generate and distribute profits. However, these projects may not always offer specific functions within their protocols.

7.1. The Honey JAR

The Honey Jar is a community united by a core concept, using a community-driven flywheel to establish sticky liquidity. In 2023, it began developing around an NFT series called Honeycomb.

The way The Honey Jar community expands is similar to how Berachain grows: by issuing and distributing derivative Honeycomb NFTs to holders. As the community grows, it collaborates with various projects in the Berachain ecosystem, providing NFT holders with the benefits of those projects, which in turn strengthens The Honey Jar’s position.

Later, The Honey Jar produced various educational materials related to Berachain, offering useful services like testnet faucets to new users entering the Berachain ecosystem. Additionally, The Honey Jar acts as a venture studio within the ecosystem, having incubated community-driven evaluation services for Berachain projects, such as S&P (Standard&Paws), and platforms that measure and reward contributions to the ecosystem, like Bera Infinity.

According to The Honey Jar’s Ecosystem Explorer, as of January 11, there were 89 projects directly involved or in collaboration with The Honey Jar, solidifying its position as one of the most influential core communities in the Berachain ecosystem. Moreover, holders of the Honeycomb NFTs receive NFT whitelist spots and token airdrops from numerous partner projects, making Honeycomb one of the few NFT series in the Berachain ecosystem to maintain a floor price of 0.6 ETH, just behind Bong Bears and Rebase NFTs.

Honeycomb NFT; Source: Opensea

In the current bArtio Testnet, the $BGT representation rights held by nodes operated by The Honey Jar rank third, only behind the nodes operated by Infrared and Kodiak. Additionally, we can observe that the next-ranking nodes are also community-centered projects, including Beraland, which provides Berachain-related information through podcasts, and TTT, which offers educational materials to Vietnamese users and operates its own node. These projects are among the top in $BGT representation rights, just behind The Honey Jar.

bArtio Testnet Validator Rankings; Source: BGT Station

From this data, we can see that community-centered strategies for gaining an advantage in the PoL mechanism are an effective approach within the current Berachain ecosystem.

8. Conclusion

In this article, we explored how the foundational protocols of the Berachain ecosystem (such as DEXs, liquidity staking, and lending protocols) combine various functionalities to create complex financial services. Through examples from different ecosystem projects, we also understood how these protocols attract user interest and liquidity by leveraging Berachain’s PoL mechanism and its unique community culture with offerings like high yields and entertainment.

At the same time, Berachain recently announced its initiatives to support the issuance of the $BERA token and early-stage ecosystem liquidity through Boyco, RFA (Request for Application), and RFC (Request for Community) programs, signaling that the mainnet is near launch.

Boyco:

A liquidity platform before the mainnet launch, where protocols planning to deploy on Berachain can negotiate liquidity and future reward distribution plans with liquidity providers in a transparent environment.

RFA (Request for Application), RFC (Request for Community):

After the Berachain mainnet launches, these programs will allocate $BERA tokens to projects that are actively developing within the ecosystem or building communities. The selected RFA and RFC projects will continue to contribute to the ecosystem using the tokens they are allocated, which will help distribute rewards to ecosystem users, thus driving initial ecosystem and liquidity activities.

From these programs, we can infer that Berachain is poised for rapid growth after the mainnet launch. Therefore, users who plan to participate in the early stages of the ecosystem should closely monitor RFA and RFC projects to devise their participation strategies.

Currently, the Pre-Boyco vaults, operated by protocols like Stakestone, Ether.fi, and Ethena, along with the Boyco vault launched on January 28, have already received 2% of the initial $BERA token supply. As of January 31, these vaults have accumulated a total deposit of $2.35 billion. If these liquidity funds are directly used by ecosystem protocols after the mainnet launch, Berachain’s TVL will surpass that of Sui, currently ranked 8th in TVL.

Boyco Dashboard; Source: Boyco

As the Boyco program concludes on February 3, users are expected to deposit funds into the high-yield vaults during the final days, further boosting the total TVL. Additionally, considering Berachain’s PoL structure encourages liquidity inflow and the recycling of profits back into the network, we expect Berachain’s TVL to significantly increase after the mainnet launch.

However, it is uncertain whether this ecosystem-first reward structure, and the attempts to strengthen it through Boyco and RFA/RFC, will ensure Berachain’s long-term sustainability. Despite this, the successful ecosystem and community-building efforts completed by Berachain before the official mainnet launch are rare in the blockchain industry, and they will surely serve as an important reference case for future projects.

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