Berachain is officially live on mainnet. This marks the beginning of a transformative period for DeFi, where security and liquidity scale together under Berachain’s novel Proof-of-Liquidity (PoL) consensus.

Proof-of-Liquidity: The Foundation of Berachain

The goal of Berachain’s proof-of-liquidity (PoL) consensus mechanism is to allow security and liquidity to scale together. In traditional proof-of-stake (PoS) blockchains, a substantial amount of capital is locked to ensure network security. This staked capital, while ensuring network security, remains idle, and does not contribute to the liquidity of the ecosystem. The fundamental idea behind proof-of-liquidity is to remove this trade-off between security and liquidity, by directly incentivizing DeFi activity with sustainable staking revenues.

The Tri-Token Model

Berachain’s economic design revolves around three distinct tokens:

• $BERA – The network’s native token, used for gas fees and staking.
• $BGT (Berachain Governance Token) – A non-transferable governance asset earned exclusively through liquidity provisioning.
• $HONEY – A native stablecoin mintable via over-collateralization.

Validators propose blocks based on their $BERA stake and distribute emissions of $BGT, which can be allocated to Reward Vaults. The amount of emissions they can distribute depends on their $BGT stake, if we want to mention this: (1) How often they propose depends on their $BERA stake. (2) How much $BGT they distribute upon proposal depends on their $BGT stake.Users providing DeFi liquidity can stake their receipt tokens in these reward vaults to be eligible for $BGT rewards.

Key Applications Powering Berachain

BEX: The Berachain Exchange

BEX is a native decentralized exchange featuring House Pools and Metapools to enhance liquidity efficiency. Liquidity providers not only earn trading fees but also accumulate $BGT, which can be staked with validators to influence governance and optimize emissions.

Bends: Native Lending Markets

Bends allows users to borrow $HONEY against collateral such as ETH, BTC, and USDC. By interacting with Bends, users deepen liquidity while simultaneously earning $BGT emissions, creating a dual-incentive model for sustainable lending.

Berps: Perpetual Futures TradingBerps is Berachain’s native perpetual futures exchange, offering high-performance derivatives trading with deep liquidity and efficient capital deployment.

Introducing BeraBoost: Optimizing Delegator Yields

With Berachain’s unique emission mechanics, delegators need a sophisticated strategy to maximize returns. This is where BeraBoost comes in—an automated allocation algorithm developed by Chorus One Research that dynamically optimizes $BGT distribution to maximize rewards.

How BeraBoost Works

Validators on Berachain play a crucial role in emission allocation. Delegators who stake with a validator benefit from the validator’s strategy for directing emissions to Reward Vaults. BeraBoost takes this a step further by:

• Algorithmically distributing emissions to maximize delegator rewards on their reward vault positions.
• Transparently directing liquidity where it is most needed.
• Reducing the complexity of staking for delegators by automating the yield-maximization process.

This mirrors how traditional DeFi yield farming strategies work but integrates them directly at the consensus level. As Camila Ramos highlighted in this thread, Berachain’s PoL effectively allows users to outsource their farming strategies to validators, providing an avenue for both sophisticated and unsophisticated users to optimize their returns without active management.

Learn more about BeraBoost here.

Why Berachain Pushes the Boundaries of DeFi Infrastructure‍

Berachain’s Proof-of-Liquidity introduces a fundamental shift in blockchain economics. By aligning security with capital efficiency, Berachain not only enhances validator incentives but also fosters deeper liquidity for the entire ecosystem. The introduction of BeraBoost further refines this model, allowing delegators to passively maximize returns while reinforcing the network’s decentralized security.With mainnet now live, Berachain is poised to redefine on-chain liquidity dynamics, governance participation, and validator incentives—all while maintaining seamless Ethereum compatibility. Builders, liquidity providers, and institutional players now have a powerful new platform to engage with.

To get started with staking or liquidity provisioning, reach out to us at [email protected] and check out our staking guide here. The era of Proof-of-Liquidity is here.

Disclaimer:

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