Written by: DeSpread

Disclaimer: The content of this report reflects the views of the respective authors and is for reference only. It does not constitute advice to buy or sell tokens or use protocols. Nothing in this report constitutes investment advice and should not be understood as such.

Introduction

Berachain is a Layer 1 network characterized by its PoL (Proof of Liquidity) consensus mechanism, aligning the interests of validators, liquidity providers, and the protocol. Currently, Berachain is conducting its second test network, the "bArtio Testnet," to address issues identified in the first test network.

Many ecological protocols have already been deployed on the bArtio Testnet version. As of January 2, according to Berachain's official website, a total of 234 protocols are participating in the bArtio Testnet, and the cumulative number of wallets testing Berachain's PoL mechanism has exceeded 2.38 million. Although this is still in the test network phase, these figures indicate a high level of market interest in Berachain and its ecosystem.

Starting from the end of 2024, Berachain founder Smokey The Bera recently introduced Boyco through a tweet on X, hinting that "Q5 will happen before April," indicating that the mainnet launch is imminent. This has attracted both new and existing users to join the Berachain ecosystem.

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

This article aims to explore various areas of the Berachain ecosystem to effectively lower the participation threshold for users. We will discuss projects that have performed outstandingly in various fields and detail how each protocol utilizes the PoL mechanism.

DEX

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

2.1. Kodiak

Kodiak is a DEX that has emerged from Berachain's incubation project "Build a Bera." In addition to supporting BEX's Uniswap v2-style features (distributing liquidity evenly across the entire price range), Kodiak also offers a CLAMM (Concentrated Liquidity Automated Market Maker) feature similar to Uniswap v3, allowing liquidity providers to set and concentrate liquidity within a specific range.

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

Moreover, due to the customizability of liquidity ranges, CLAMM liquidity position tokens are often difficult to use in other protocols. However, Kodiak standardizes users' CLAMM liquidity positions through the Island feature, allowing these LP tokens to be used in other protocols, promoting more flexible and diverse ecological gameplay.

Before the mainnet launch, Kodiak has already collaborated with many projects in the Berachain ecosystem, establishing its position as a core infrastructure. They also operate their own Berachain node as a validator, and as of January 3, they have received the second-highest BGT authorization in the bArtio Testnet.

2.2. Honeypot Finance

Honeypot Finance is a protocol that supports all aspects of the token lifecycle, from issuance to providing liquidity and effective trading, composed of several sub-protocols:

• Henlo DEX: A DEX specifically designed to protect users from MEV attacks, offering limit orders and Batch-A2MM features that collect user orders over a specific period and execute them at the same price.

• Dreampad: A launchpad protocol that provides incubation and financing opportunities for projects preparing to launch on Berachain while ensuring fair token launches and distributions.

• Pot2Pump: A meme coin sale platform that provides a safer environment for meme coin sales and trading, featuring functionalities to prevent bot sniping and refund participating users if the 24-hour fundraising target is not met.

Like Kodiak, Honeypot Finance also plans to operate as a validator after the mainnet launch, offering its governance token $HPOT as a delegation reward to users who delegate $BGT.

Additionally, Honeypot Finance enhances the liquidity of $HPOT by releasing accumulated $BGT into the $HPOT liquidity pool. The protocol also plans to increase the token's value by using node operation income to buy and burn $HPOT, retaining the reward value paid to $BGT delegators, further solidifying $HPOT's liquidity.

In addition to Kodiak and Honeypot Finance, other protocols advocating for efficient and convenient trading functionalities are also preparing for the Berachain mainnet, including BurrBear, which supports capital-efficient trading by aggregating three or more similarly priced underlying assets (similar to Curve Finance), liquidity aggregator OogaBooga, and cross-chain abstract trading protocol Shogun.

Liquid Staking

In a typical PoS network, network rewards are distributed to validators who hold a certain amount of tokens and operate nodes. Therefore, if the network itself does not have a native token authorization structure, general users who do not operate nodes cannot receive network rewards.

To address this issue, liquid staking protocols distribute rewards by accepting the staking of native tokens and delegating node operations, allowing general users to participate in network staking. These protocols also issue LP tokens to stakers as proof of how many native tokens they hold, thereby increasing the liquidity of the ecosystem. Through these functionalities, liquid staking protocols have become a core infrastructure of PoS networks.

In contrast, while Berachain's node operations require 69,420 $BERA, its structure allows liquidity providers to receive network rewards calculated in $BGT and liquidity provision interest when they deposit liquidity tokens obtained from ecological protocols into Berachain. Thus, aside from differences in methods and sequences, Berachain has essentially built liquid staking into the network protocol.

Although Berachain's node operations on the mainnet require 250,000 $BERA, Berachain's structure distributes $BGT rewards and interest to liquidity providers, so aside from differences in methods and sequences, Berachain has essentially built liquid staking into the network protocol.

However, in Berachain, existing protocols can only provide 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 to kickstart their liquidity pools.

In this context, Berachain's liquid staking protocol will provide a redemption function for $BGT (which determines emission voting rights). This allows Berachain ecological projects to incorporate liquidated $BGT into their protocol mechanisms without needing to negotiate with validators or nodes. In other words, this makes it easier for ecological protocols to adopt a structure that closely integrates the PoL mechanism.

3.1. Infrared

Infrared is a liquid staking protocol co-incubated with Kodiak through Berachain's "Build a Bera" program.

The storage vault operated by Infrared can accept LP tokens from liquidity pools, generating $BGT interest while running network nodes. When users deposit LP tokens into these vaults, Infrared uses these tokens to generate $BGT, and users can claim $iBGT (liquidated $BGT) proportional to their deposited LP tokens.

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

• Stake in Infrared to receive rewards generated by the nodes

• Use in other DeFi protocols

• Sell for profit

Therefore, Infrared concentrates and distributes the rewards generated by the PoL mechanism by turning $BGT into a liquid token, benefiting fewer $iBGT stakers. It also helps other protocols within the Berachain ecosystem incorporate $iBGT into their protocols, allowing their platforms to offer higher yields to their users. Additionally, Infrared plans to launch new features that will enable them to receive and liquidate the $BERA required for node operations while distributing profits.

The best example of effectively utilizing Infrared's features is Kodiak's Island Pool, which we briefly introduced in the DEX section above. After the mainnet launch, Infrared plans to launch Kodiak's Island Pool (which is already operational in the testnet), allowing users to farm $iBGT more efficiently using Kodiak's CLAMM and to 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 gameplay options within the ecosystem.

Based on the interconnectivity of the protocol and effective ecological gameplay, Infrared has garnered significant attention from many users and currently accepts the most $BGT delegation in the bArtio Testnet. Furthermore, many ecological projects have already partnered with Infrared and plan to launch various derivative products, indicating that Infrared will become a crucial infrastructure after the mainnet launch.

Meanwhile, the specific details regarding how Infrared will use delegated $BGT to select $BGT's emission have not yet been disclosed. Therefore, closely monitoring whether Infrared will implement these processes in a decentralized manner and to whom it will grant voting rights for its held $BGT will be quite important.

3.2. BeraPaw

BeraPaw is also a liquid staking protocol, but instead of running its own nodes, it operates vaults between different nodes and liquidity pools registered with 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 from staking $BGT to the holders of $LBGT through this method.

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

The above are two liquid staking protocols preparing for an official launch on Berachain. While these protocols not only allow for more derivative products but also provide users with more gameplay options, they also complicate the ecosystem further. In the Berachain network, the power and status of nodes will be proportional to the amount of delegated $BGT, and liquid staking protocols that provide $BGT liquidation functionality are expected to be adopted by many users and protocols, becoming core infrastructure.

Lending

Berachain also has a native lending protocol called BEND, offering 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, and 2) deposits of $WBTC and $WETH do not earn interest but generate $BGT rewards when borrowing $HONEY.

Through this structure, BEND strengthens Berachain's triple token economic structure, generating basic interest for $HONEY while increasing borrowing demand through $BGT, enriching the ecosystem's liquidity. Users can also execute $BGT leveraged farming by repeatedly swapping borrowed $HONEY back to $WETH and $WBTC and depositing it into BEND.

Next, we will explore several major lending protocols preparing to launch on Berachain and the features offered by each platform.

4.1. BeraBorrow

BeraBorrow is an over-collateralized stablecoin issuance protocol that allows users to mint the $NECT stablecoin. It not only permits ordinary assets like $BERA and $HONEY 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, where depositors can collect borrowing fees and liquidation fees from $NECT borrowers, establishing a structure that supports the basic demand for $NECT.

Additionally, BeraBorrow has a governance token, $POLLEN, which can serve as an incentive token in the following ways:

• Used to reward liquidity pools that receive $BGT emission

• Encourage collateral deposits to liquidity pools with high $NECT debt

• Distributed as rewards to depositors in the liquidity stability pool

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

Furthermore, BeraBorrow also 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.

With various demand support mechanisms, $NECT is expected to become a core native stablecoin alongside $HONEY in the Berachain ecosystem.

4.2. Gummi

Gummi is a lending protocol incubated through "Build a Bera" that operates without the need for oracles, allowing anyone to create lending pools without restrictions. Utilizing this architecture, Gummi plans to enable users to establish leveraged positions of up to 100 times using any asset on Berachain.

Before the mainnet launch, Gummi has already established partnerships with core infrastructures like Infrared and Kodiak and plans to support leveraged farming position functionalities for $iBGT and various LP tokens from Kodiak.

Thus, unlike other networks where lending protocols are primarily used for specific assets for leverage and hedging positions, Berachain's lending protocols can amplify the $BGT emission of the PoL mechanism. Therefore, as more protocols launch on Berachain and the ecosystem diversifies, the utility and demand for lending protocols are expected to increase, making them an important component of the ecosystem.

Derivative Protocols

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

In Berps, users can use $HONEY to establish 100 times leveraged positions on various assets or deposit $HONEY to provide the liquidity needed for traders' positions, earning trading fees, funding fees, and $BGT in return.

Through this structure, Berps gives $HONEY a clear use case as the underlying asset of Berachain's native Perp DEX while also providing a simple yet effective entry point for $BGT farming, allowing new users who find the PoL mechanism daunting to mine $BGT rewards through a single token deposit of $HONEY. Therefore, this protocol is expected to become one of the most critical protocols supporting Berachain's triple token economy.

Next, let's take a look at some unique derivative protocols preparing to launch on Berachain.

5.1. SMILEE

SMILEE is an options protocol capable of creating hedging positions for DEX liquidity providers. The options created in SMILEE have a unique structure that can generate more profits during significant price fluctuations, creating an effect that is entirely opposite to impermanent loss (IL), which causes liquidity providers to incur greater losses during volatility.

Users must pay a certain premium to establish options positions in SMILEE, with three types of options positions available to choose from:

• Bull: Bet on significant upward price volatility until expiration.

• Bear: Bet on significant downward price volatility until expiration.

• Smile: Bet on significant price volatility either upward or downward until expiration.

In addition to such options trading, users can provide liquidity for the options positions created by traders and collect the premiums paid by traders. Although liquidity providers will face impermanent loss (IL) equal to the profits of traders, similar to providing liquidity to DEXs, SMILEE reduces the impermanent loss for liquidity providers by providing liquidity positions that are rebalanced in real-time when options trading occurs.

The Berachain network protocol is expected to create liquidity pools on major DEXs (including the native dapp BEX) to enhance 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 LP positions. Furthermore, if SMILEE's options positions begin to receive $BGT emissions in the future, SMILEE's position within the Berachain ecosystem will become even more solidified.

5.2. Exponents

Exponents is another derivative protocol that implements non-liquidatable leveraged positions on all assets within the ecosystem through its self-developed inverse asset issuance protocol, IBC (Inverse Bonding Curve).

IBC adopts an inverse Bonding Curve, which is the opposite of the general concept of a Bonding Curve. A Bonding Curve is a price discovery mechanism recently adopted by many meme coin launchpads (such as Pump.fun). Traditional Bonding Curves achieve price increases by reducing the required amount of assets and increasing the price as more collateral assets are deposited into the liquidity pool; whereas IBC implements inverse assets, where prices decrease as demand increases, and the amount of receivable assets also increases as more collateral assets are deposited.

Exponents uses the IBC mechanism to achieve long and short positions on all assets without the need for oracles, aiming to provide non-liquidatable leveraged positions by adjusting the parameters of the IBC mechanism to make the slope of the Bonding Curve steeper.

Additionally, IBC also provides functions for staking synthetic assets issued within the protocol and distributing profits generated by the protocol. When combined with Berachain's PoL mechanism, $BGT emissions 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, thereby achieving a more diverse ecological gameplay.

In addition to the aforementioned SMILEE and Exponents, various derivative protocols are also preparing to launch on Berachain, including IVX, which allows for the establishment of short-term high-leverage positions at low costs through 0-DTE functionality, and Polarity Finance, which provides loans secured by options. Compared to derivative tools in other network ecosystems, each type of derivative tool is more diverse and complex, with some protocols complementing Berachain's PoL mechanism, while others leverage this mechanism to highlight their unique advantages.

Others

So far, we have explored several protocols that serve as fundamental infrastructure within the blockchain ecosystem (including DEX, liquid staking, lending, and derivative protocols), discussing how these projects highlight their unique advantages while utilizing the PoL mechanism in Berachain.

However, beyond the currently introduced DeFi track, 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 achieve a high degree of synergy with the ecosystem without directly employing the mechanism; there are also projects that claim to align with Berachain's cultural codes, each attracting user interest and attention with their unique features.

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

6.1. Goldilocks

Goldilocks is a DAO and platform developing a DeFi infrastructure exclusive to Berachain, consisting of the following sub-protocols:

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

• Goldilend: A lending protocol for NFT collateral within the Berachain ecosystem.

• Goldivaults: Generates interest using time-locked assets stored in Berachain's DeFi protocols. Depositors receive OT (Ownership Tokens), granting the right to claim principal at maturity, and YT (Yield Tokens), granting the right to claim generated interest. This allows users to trade future interest income, providing functionality similar to Pendle Finance on Ethereum. (For detailed information on this feature, please refer to the article "Pendle Finance - Discovering Untapped Trading Markets").

Thus, Goldilocks provides Berachain-optimized services within the ecosystem, such as NFT collateral lending and interest trading functions, where the NFTs and liquidity provided by the protocol play a more significant role compared to other networks. Additionally, Goldilocks is expected to gradually ensure more users and liquidity through a platform token with a progressively increasing price structure and the utilization of this token's lending services.

Meanwhile, Pendle Finance has also become a core DeFi protocol adopted by many projects in the current Ethereum ecosystem, facilitating liquidity deposits through YT distribution of protocol points to promote its airdrop activities. Similarly, whether Goldilocks can collaborate with other projects preparing for token issuance within the Berachain ecosystem to create various types of Goldivaults, thereby achieving a dominant position in Berachain, will be an interesting point of focus.

6.2. Beradrome

Beradrome is a protocol that aggregates user liquidity tokens, distributing the generated profits and rewards negotiated with other protocols to users. Beradrome employs the following three native tokens to internalize the profits generated within Beradrome:

• $oBERO: Tokens that reward users who deposit liquidity tokens in Beradrome. By burning $oBERO, users can gain voting rights on the $oBERA reward emission rate in the liquidity pool or deposit an equivalent amount of $HONEY in Beradrome to mint and receive $BERO.

• $BERO: The main token of Beradrome. Since the minting process involves burning deposited $HONEY along with $oBERO, its value guarantee remains above 1 $HONEY.

• $hiBERO: The governance token of Beradrome, which can be obtained by staking $BERO. Users can use the $BGT held by Beradrome to vote on which liquidity pools should receive $oBERO and can earn profits generated by the protocol. They can also use staked $hiBERO as collateral to borrow $HONEY.

Thus, Beradrome encourages the internalization of rewards generated within the protocol through the $BERO minting mechanism using $oBERO, maintaining the prices of $BERO and $hiBERO above $1, while providing $hiBERO holders with non-liquidatable borrowing opportunities for the deposited $HONEY during the minting process of $BERO. This will continuously attract external liquidity into the protocol, encouraging more protocols to develop liquidity through Beradrome and establishing a self-sustaining flywheel that redistributes the rewards it provides to users.

Additionally, Beradrome plans to operate its own nodes, obtaining $BGT emission voting rights by accepting external $BGT delegations, separating this from its protocol operation mechanism, and allocating $BGT to the $hiBERO minting pool. If this plan succeeds in the future, $hiBERO holders will simultaneously receive both Beradrome's profits and $BGT, potentially attracting more liquid funds to the Beradrome ecosystem.

6.3. Yeet

Yeet is an on-chain betting game protocol that uses $BERA. Anyone can bet $BERA (approximately 0.5% higher than the previous depositor's $BERA) in Yeet's liquidity pool during the set game time to participate in the game, and the last user to deposit $BERA takes 80% of the total deposits in that liquidity pool.

Even if users do not win the game, they can receive Yeet's native token $YEET as a reward proportional to their betting amount. Users can stake the received $YEET in Yeet's Liquidity Trifecta Vault to earn betting interest.

The Liquidity Trifecta Vault will take 9% from the $BERA deposited by users in the game and the staked $YEET. The vault will use the deposited assets to provide liquidity to Kodiak, and the liquidity tokens received from Kodiak will be re-deposited into Beradrome to maximize the interest paid to depositors.

Additionally, Yeet plans to launch the YeetBond feature, allowing users to claim bonds for specific tokens at a discounted price based on the market price at expiration. In Berachain, there are various methods to create future value using liquidity, and the functionality provided by YeetBond is expected to be actively utilized by various protocols as a means to ensure liquidity.

Therefore, Yeet plans to provide optimized "fun features" and "effective features" for Berachain, establishing a solid community centered around its unique joyful and humorous meme culture since the testnet phase, including Yeetard NFTs with $YEET reward enhancement features.

6.4. Ramen

Ramen is a Launchpad protocol similar to Honeypot Finance's Dreampad, helping new protocols preparing to launch on Berachain promote themselves and securely raise funds through fair token sales. The platform supports two Launchpad modes:

• Fixed Price Mode: A method to purchase tokens at a fixed price. Users must register on the whitelist to participate in the issuance platform or stake the platform's native token $RAMEN to obtain Gacha tickets, which can be consumed to win in a lottery.

• Price Discovery Mode: Unlike the fixed price mode, anyone can participate. Users wishing to purchase deposits equivalent to their desired substitute token price * quantity will engage in blind bidding to determine the settlement price. The right to purchase tokens at the settlement price is granted starting from the highest bidder.

In addition to the Launchpad functionality, Ramen also plans to launch Airdrop Recipes, which allow users to easily set and execute token airdrop standards. Ramen provides all the necessary functions from token issuance to sales and distribution, aiming to become the core infrastructure adopted by many new projects after the launch of the Berachain mainnet.

However, to maintain user interest in Ramen, it must possess a certain degree of protocol dependency characteristics, requiring successful operation of projects that need to sell tokens through Ramen and providing profits to token buyers. Therefore, it is necessary to continuously observe the long-term growth of projects selling tokens through Ramen and whether promising projects choose to use the Ramen issuance platform.

6.5. PuffPaw

PuffPaw is a Vape 2 Earn project where users can earn tokens through vaping. It measures users' smoking activities through self-produced smoking devices and liquid cartridges, distributing higher $VAPE tokens for lower nicotine content liquids to encourage quitting smoking.

Additionally, through its Leasing-Borrowing program, users who do not want to smoke but wish to participate can lend devices to users who cannot purchase them and share profits, creating a structure that attracts Berachain ecosystem users regardless of smoking habits.

In December 2023, PuffPaw's PUFF PASS NFT sold out successfully as a ticket for project participation, and plans to strengthen its Vape brand image and expand its ecosystem through additional device sales. Furthermore, the company plans to generate additional revenue by providing user device usage data to AI companies and insurance firms, supporting the value of $VAPE provided as rewards, while also planning to establish methods to create additional income for $VAPE holders using the PoL mechanism.

Having read this far, we have studied the protocols representing various tracks on Berachain, each with its unique advantages. Additionally, there are other projects that do not require understanding Berachain's liquidity mechanism to participate:

• 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 such as Dirac Finance, NAV, and D2 will also be launched successively, simplifying various DeFi strategies in the ecosystem by combining Berachain protocol functionalities, allowing new users to easily participate and earn profits through straightforward risk management.

These protocols can not only encourage more users to join the Berachain ecosystem to increase overall liquidity but also promote the use of the ecosystem simultaneously.

Community

Most of the protocols in the Berachain ecosystem adopt a structure that allocates high returns to liquidity providers to gain initial liquidity, actively utilizing the PoL mechanism and employing NFTs and memes to build communities as a means to further strengthen and expand these structures.

Since the PoL mechanism allows users holding more $BGT and liquidity in the ecosystem to have higher negotiation power and more opportunities for incentives, some projects' strategies involve first forming communities through NFTs and memes, establishing reputation and status through various community activities, and then generating and distributing profits, even if these projects do not necessarily provide specific functionalities in their protocols.

7.1. The Honey JAR

The Honey Jar is a community united by a core idea, establishing sticky liquidity through a community-driven flywheel, developing around an NFT called Honeycomb in 2023.

The Honey Jar community's expansion method is similar to Berachain's growth, both through the issuance and distribution of derivative NFT series of Honeycomb to holders. Based on the expansion of the community, it collaborates with various projects developed within the Berachain ecosystem, providing various benefits of these projects to NFT holders, thereby consolidating its position.

Subsequently, The Honey Jar produced various educational materials related to Berachain and provided useful services such as testnet Faucets for new users entering the Berachain ecosystem. Additionally, The Honey Jar is also a venture studio within the Berachain ecosystem, incubating community-based evaluation services S&P (Standard & Paws) for assessing Berachain ecosystem projects, as well as a platform Bera Infinity for measuring and rewarding contributions to the Berachain ecosystem.

According to The Honey Jar's Ecosystem Explorer, as of January 11, there are a total of 89 projects that Honey Jar directly participates in or has partnerships with, establishing Honey Jar as the most influential core community in the current Berachain ecosystem. Furthermore, users holding Honeycomb NFTs will also receive NFT whitelist and token airdrop opportunities from numerous partner projects, making Honeycomb the NFT series in the Berachain NFT ecosystem, maintaining the highest floor price of 0.6 ETH outside of Bong Bears and Rebase NFT.

In the current bArtio Testnet, the $BGT representation rights obtained by nodes operated by The Honey Jar rank third, only behind nodes operated by Infrared and Kodiak. We can also see that the subsequent rankings are also community-centered projects, including Beraland, which provides Berachain-related information in podcasts, and TTT, which provides educational materials for Vietnamese users and operates nodes, both ranking just below The Honey Jar in terms of $BGT representation rights.

Through this data, we can understand that obtaining advantages in the PoL mechanism through community-centered strategies is an effective approach in the current Berachain ecosystem.

Conclusion

In the above, we explored how the foundational infrastructure agreements of the Berachain ecosystem (such as DEX, liquidity staking, and lending protocols) combine various functions to create complex financial services. We also learned through examples of ecological projects how different protocols attract user interest and liquidity through Berachain's PoL mechanism and unique community culture with "high returns" and "entertainment."

At the same time, Berachain recently announced plans to support the issuance of the $BERA token and initial ecological liquidity through Boyco, RFA (Request for Application), and RFC (Request for Community), indicating that the mainnet is about to launch.

• Boyco: A liquidity platform before the mainnet launch, allowing protocols planning to deploy on Berachain to negotiate liquidity and future reward distribution plans with liquidity providers in a transparent environment in advance.

• RFA (Request for Application), RFC (Request for Community): After the launch of the Berachain mainnet, a plan to allocate $BERA tokens to projects actively developing or building communities within the ecosystem. Selected RFA and RFC will continue to contribute to the ecosystem using the allocated tokens, promoting initial ecological activities and liquidity activities through distribution to ecosystem users.

From these plans, it can be inferred that Berachain will experience rapid growth after the mainnet launch, so users planning to participate in the early ecosystem should closely monitor the developments of RFA and RFC projects to formulate their strategies for engaging with the ecosystem.

Currently, the Pre-Boyco vaults operated by protocols such as Stakestone, Ether.fi, and Ethena, along with the Boyco vault launched on January 28, have secured 2% of the initial $BERA token supply. As of January 31, these vaults have accumulated total deposits of $2.35 billion. If this liquidity is directly utilized by ecological protocols after the mainnet launch, Berachain's TVL will surpass that of Sui, which currently ranks 8th in TVL.

As the end date of Boyco on February 3 approaches, users are expected to deposit funds into the high-yield vault in the final days, further boosting the total TVL. Additionally, considering that Berachain's PoL structure encourages liquidity inflow and recycles the profits generated back into the network, we estimate that the network's TVL will significantly increase from its current figures after the mainnet launch.

However, we cannot definitively say that this ecosystem-prioritized reward structure, along with attempts to strengthen it through Boyco and RFA/RFC, can perfectly guarantee Berachain's long-term sustainability. Nevertheless, the ecosystem and community cases successfully built before the official launch of the mainnet are quite rare in the blockchain industry, making them an important reference case for projects that will be launched in the future.

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