State of Livepeer Q1 2025

Key Insights

• Transcoding usage on the Livepeer network increased 49% QoQ, with demand-side fees rising 51% to $110,000, driven by broader adoption of GPU-backed infrastructure and real-time AI video applications.
• AI fees rose 640% QoQ to $53,000, accounting for nearly 48% of total network fees.
• Staking participation climbed from 43% to 48% during the quarter, contributing to a higher inflation rate under the protocol’s dynamic issuance model.
• ​​Staking rewards declined 26% QoQ to $18.8 million, primarily due to a 68% drop in LPT price. However, real yield remained stable as fee revenue grew.
• The Livepeer Foundation was announced in Q1 2025 and established in June to oversee ecosystem development, while the GovWorks SPE began implementing procedural updates to improve proposal and treasury management.

Primer

Building decentralized video apps like Twitch or TikTok requires live and on-demand video streaming infrastructure. Based on a user’s bandwidth and device, video content needs to be processed; i.e., transcoded, into viewable formats. While cloud providers like AWS, Google, or Microsoft are commonplace solutions for video transcoding, they incur high costs.

Livepeer (LPT) is an open, permissionless network that provides a decentralized marketplace for video infrastructure, supporting both live and on-demand streaming. Its compute marketplace enables participants to contribute GPU resources for various workloads, including video transcoding and AI-powered video processing. As AI-driven video models demand significantly more GPU compute than text and image generation, Livepeer offers a scalable and cost-efficient solution for video-related compute tasks. The network is designed to lower transcoding costs for end users by up to 10x. Within Livepeer’s decentralized transcoding network, there are three key participants:

• Node operators, called "Orchestrators" route transcoding jobs. The amount of work a node operator can perform is proportional to how many Livepeer native tokens (LPT) it stakes. Node operators earn ETH fees and newly minted LPT rewards.
• Service nodes, called "Transcoders" provide compute resources for node operators and deliver video transcoding. In return, they earn ETH fees. Typically, Orchestrators and Transcoders run within the same machine (combined setup).
• Delegators stake LPT towards effective node operators to help secure the Livepeer network. Staking is rewarded with a portion of both ETH fees and LPT rewards.

Livepeer has also expanded beyond video transcoding by introducing Livepeer AI, a specialized network for AI inference tasks. Livepeer AI supports AI-powered video generation capabilities, including text-to-image, image-to-image, and image-to-video processing. These services cater to use cases in entertainment, social media, and gaming. Livepeer AI is currently in its beta phase, and is expected to expand model support and enable broader AI workloads in the future.

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Key Metrics

Performance Analysis

Demand for Livepeer comes from apps and developers needing video transcoding, live-streaming, and video generation capabilities. This includes decentralized social media (DeSoc) applications, Web3-native platforms, and traditional Web2 applications requiring scalable video infrastructure. While platforms like TikTok, Twitch, Spotify, and SoundCloud rely on centralized infrastructure for streaming, similar applications in the Web3 space, such as decentralized video platforms, music streaming apps with tokenized incentives, or NFT-based media platforms, could leverage Livepeer’s decentralized video streaming and transcoding services.

Network

Livepeer’s network usage can be gauged by estimating the number of minutes of video transcoded.

Livepeer’s transcoding network usage increased 49% QoQ, rising from 35 million minutes in Q4 2024 to 52 million in Q1 2025. The uptick is due to the broader adoption of Livepeer’s infrastructure, particularly for real-time and AI-enhanced video workloads.

This growth was supported by broader adoption of GPU-backed infrastructure for AI-powered use cases such as VTuber avatars and generative overlays via the ComfyStream integration. Additional factors included a developer bootcamp with Encode Club focused on real-time AI video tools, new integrations with ChatandBuild and Farcaster that expanded usage across social and collaborative platforms, and backend upgrades to the Cascade pipeline that improved efficiency and throughput for complex workloads.

Fees from Transcoding

Services using the Livepeer network pay demand-side fees in ETH to access video transcoding and AI-powered processing tasks. Node operators (orchestrators) earn these fees for processing video and distribute a portion to their delegators based on their fee-sharing structure. The likelihood of receiving transcoding work is influenced by stake weight; orchestrators with higher stake are prioritized for more work, leading to greater earnings in transcoding fees. This system incentivizes both node operators and delegators, reinforcing network participation and security.

Livepeer’s demand-side fees from transcoding increased by 51% QoQ, rising from $73,000 in Q4 2024 to $110,000 in Q1 2025. This growth closely tracked the 49% increase in network usage, yet it significantly outpaced the performance of ETH, which fell approximately 45% over the same period.

Since fees are paid in ETH, a decline in ETH’s price would typically reduce USD-denominated revenue unless offset by either higher usage or increased per-minute fees. The fact that USD revenue rose despite the price drop suggests a meaningful increase in ETH-denominated fee volume, likely driven by a shift toward more complex and compute-intensive workloads.

While infrastructure upgrades such as Cascade, improved execution efficiency and GPU utilization, they also enabled the deployment of more demanding real-time video applications. Tools like ComfyStream and Daydream introduced persistent, high-throughput workloads, such as VTuber avatars and AI video overlays, that increased GPU usage and session length. These dynamics contributed to higher aggregate fee consumption despite potential per-unit cost reductions. The decoupling between ETH price and network revenue in Q1 points to the growing demand for advanced, value-intensive use cases as the main driver of fee growth.

Fees from Livepeer AI

​​In Q1 2025, Livepeer continued expanding its role beyond video transcoding through ongoing development of the Livepeer AI, which launched in Q3 2024 to support decentralized AI-powered video generation. This progress included the refinement of Cascade, a real-time AI video processing pipeline introduced in late 2024. Cascade enables applications such as automated video agents, live analytics, and interactive overlays by orchestrating GPU resources for continuous media workflows. These developments further positioned Livepeer as a decentralized media compute provider, extending its infrastructure to support emerging AI-driven video use cases.

In the Livepeer AI ecosystem, tickets and fees represent the underlying compensation model for node operators performing AI-powered video processing. Through Livepeer’s probabilistic micropayment system, winning tickets are issued to operators and redeemed for ETH-based fees. These metrics offer insight into the demand for AI infrastructure and the economic health of AI-related activity on the network.

In Q1 2025, Livepeer’s AI Subnet generated approximately $53,000 in fees, accounting for 48% of total transcoding revenue, compared to $7,000 (10%) in Q4 2024 (+460% growth QoQ). The network recorded 17,434 winning tickets for AI workloads, up from 1,847 in the previous quarter (840% growth QoQ). The average fee per ticket declined from $3.85 to $3.02.

A spike occurred on March 14, 2025, when 848 AI-related tickets were issued, generating over $2,000 in fees, the highest daily total for the quarter. This may have coincided with coordinated developer activity or milestones related to the Real-Time Video AI Bootcamp, which launched in early February. The bootcamp encouraged developers to experiment with Livepeer’s Pipelines and AI tooling on mainnet infrastructure.

Staking Rewards

The Livepeer network distributes staking rewards in LPT to node operators and delegators. To provide video services on the Livepeer network, node operators must stake LPT. A node operator’s stake weight comprises their own tokens and those delegated towards them.

Livepeer’s staking rewards declined by 26% QoQ, falling from approximately $25 million in Q4 2024 to $19 million in Q1 2025. This drop was primarily due to the decline in the price of LPT, which fell by 68% over the quarter, from $15 to $4.8. The lower token price significantly reduced the USD-denominated value of rewards, even though the number of tokens issued remained consistent. Despite these market conditions, staking participation increased, with the percentage of eligible LPT supply staked rising from 42.8% to 48.4% during the quarter.

On a protocol level, Livepeer’s annualized daily inflation rate rose from 23% to 25%, while the annualized daily real yield (USD) increased from 38% to 41%. This was largely due to a 51% QoQ rise in transcoding fee revenue, which helped partially offset LPT’s price decline.

Community discussions around inflation reform continued throughout Q1. Notably, on Feb. 6, 2025, a proposal was introduced to adjust Livepeer’s token issuance parameters, including lowering the target bonding rate and raising the inflation change rate, intended to gradually reduce inflation when staking participation exceeds the target threshold. While not yet passed, the proposal reflects growing interest in fine-tuning the network’s monetary policy for long-term sustainability.

Staking Participation

The Livepeer Token (LTP) operates under a Stake-for-Access (SFA) model, requiring node operators to stake LPT to perform work on the network. Over the past seven quarters, staking participation, the percentage of circulating LPT supply that is staked, has remained below the 50% target level. Additionally, the number of delegators has declined, decreasing from 3,713 in Q1 2024 to 2,993 in Q1 2025.

This downward trend in delegator participation suggests that, despite increased staking rewards, fewer participants are securing the network. Consequently, those who continue to stake may be earning a larger share of the rewards due to higher token emissions and network incentives.

In Q1 2025, Livepeer experienced a steady rise in staking activity. The percentage of LPT staked increased from 42.8% at the start of January to 48.4% by the end of March. This growth reflects a consistent increase in validator and delegator participation.

This rise in staking corresponded with a modest increase in the network’s inflation rate, which rose from 0.0593% to 0.0643% daily, averaging 0.0617% per day, or approximately 25.2% annualized. This relationship is governed by Livepeer’s dynamic inflation model, which adjusts issuance based on whether staking participation falls below or exceeds a 50% target threshold.

As staking remained below the 50% target, inflation continued to increase incrementally throughout the quarter, effectively reinforcing incentives for additional participation.

A notable spike occurred on March 14, 2025, when the staked percentage jumped from 45.4% to 47.6%, marking the largest single-day increase in the quarter.

Despite the increase, staking levels remained below the 50% threshold, highlighting a structural characteristic of the network: the decoupling between staking incentives and actual transcoding workload distribution. Prior research has shown that the top five orchestrators by LPT stake earned 40–50% of staking rewards but captured only ~20% of transcoding fees, potentially limiting the incentive for some operators to stake beyond the point of fee optimization.

LPT’s circulating market cap declined 66% QoQ, falling from $189 million to $552.6 million in Q1 2025. This decrease aligned with a 68% drop in the price of LPT, which moved from $15.0 to $4.8 over the quarter.

Qualitative Analysis

Partnerships and Ecosystem Expansions

Real-Time Video AI Bootcamp: On Feb. 5, 2025, Livepeer launched the Real-Time Video AI Bootcamp. This developer-focused program combined technical workshops, hands-on project development, and incentivized challenges to accelerate adoption of real-time AI video processing. Participants explored workflow orchestration using Livepeer’s Pipelines product, gained experience with GPU-backed inference, and leveraged the network’s decentralized infrastructure to build interactive applications. The initiative aimed to onboard new technical talent and encourage ecosystem experimentation with Livepeer’s AI stack.

ComfyStream Integration: On Jan. 30, 2025, ComfyStream, an open-source real-time video layer built on ComfyUI, integrated with Livepeer’s infrastructure to support AI-powered video pipelines. This integration enabled developers to build applications such as live filters, generative overlays, and avatar agents by using Livepeer as the GPU-backed inference engine. ComfyStream’s architecture also incorporated frame-level optimizations (e.g., Torch Compile, TensorRT) to achieve low-latency performance for real-time video workflows that were previously constrained to offline processing.

ChatandBuild Integration: On March 24, 2025, Livepeer was integrated into ChatandBuild, a real-time co-building and streaming environment. This partnership enabled users to stream live development sessions while collaborating, expanding Livepeer’s presence in real-time Web3 workspaces. To showcase the integration, ChatandBuild and Livepeer co-hosted a themed hackathon titled “Live Video AI Meets Fashion.” The event invited participants to build interactive livestreams, AI-styled overlays, and no-code creator tools. Promotional material highlighted creative use cases and offered prizes such as a $300 Vestiaire Collective gift card to encourage participation.

Technological Advancement

Cascade Matures in Q1 2025 with Enhanced AI Streaming Capabilities: Livepeer’s AI evolution continued in Q1 2025 as the network expanded its real-time video capabilities through further development of the Cascade pipeline, first introduced in Q4 2024. Cascade marked a strategic shift from batch AI processing to real-time AI-powered video workflows, enabling applications such as automated video agents, VTuber overlays, live analytics, and AI-enhanced content generation.

Originally built on the AI Subnet, which launched in Q3 2024 to support decentralized inference workloads like text-to-image and image-to-video generation, Cascade extends these capabilities to persistent, live media processing. By Q1 2025, Livepeer had implemented critical improvements to Cascade’s infrastructure, including multi-container GPU orchestration, enhanced stream processing efficiency, and native support for streaming AI agents.

These updates enabled more complex, compute-intensive workflows that remained active over longer durations, supporting use cases such as interactive avatars and real-time scene augmentation. The pipeline also benefited from backend optimizations and broader adoption by platforms like ComfyStream, which leveraged Cascade to build real-time AI overlays and video control flows.

Daydream Launch – Prompt-Based Video Effects: ​​On Feb. 28, 2025, Livepeer launched Daydream, a creator-facing tool designed to apply real-time video effects using structured natural language prompts. Daydream allows streamers, artists, and content creators to generate dynamic visual overlays and transformations by simply inputting prompts. The tool emphasizes low-latency rendering and ease of use, extending Livepeer’s AI infrastructure to a broader creator audience without requiring coding expertise.

Governance

Harmonic SPE Governance Proposal: On March 17, 2025, the Livepeer community passed a governance proposal to allocate 15,000 LPT from the treasury to fund the Harmonic SPE, an initiative designed to integrate Livepeer-powered streaming into Farcaster, Base, and Coinbase Wallet. The proposal aims to expand Livepeer’s infrastructure across onchain media platforms, supporting decentralized social video use cases. Developed by community contributors and funded through the Livepeer treasury, the initiative signals growing alignment between the network’s protocol and emerging onchain social ecosystems.

Livepeer Foundation Established: On April 16, 2025, the Livepeer Foundation was announced as a newly formed Cayman-based non-profit entity dedicated to stewarding the protocol’s decentralization and long-term development. Officially established in June 2025, the Foundation is responsible for core ecosystem functions, including technical roadmapping, contributor onboarding, capital deployment, and infrastructure operations. It also participates in protocol governance by seeking delegated LPT stake to help secure the network. The launch of the Livepeer Foundation marked a significant milestone in formalizing Livepeer’s governance structure and aligning strategic initiatives across the ecosystem.

GovWorks SPE Implementation: GovWorks is a governance-focused Special Purpose Entity (SPE) established to streamline Livepeer’s onchain proposal processes and improve treasury operations. On Feb. 7, 2025, it began executing on several process improvements, with deliverables for the first half of the year that included standardizing proposal formats, establishing quarterly funding cycles, publishing governance digests, and supporting the creation of additional SPEs. These efforts aimed to increase transparency, improve participation, and enhance the effectiveness of Livepeer’s decentralized treasury.

Inflation Mechanism Update Proposal: On Feb. 6, 2025, a governance proposal was introduced to revise Livepeer’s token issuance model by adjusting key inflation parameters. Specifically, the proposal suggested lowering the target bonding rate and increasing the inflation change rate to reduce LPT inflation more aggressively when staking participation exceeds the target. The goal was to improve long-term sustainability and better align validator and delegator incentives with network health. As of the end of Q1, the proposal had not advanced to a formal vote, but the discussion reflected growing community interest in refining Livepeer’s economic design.

Community Engagement and Events

ComfyUI NYC Meetup: On Feb. 19, 2025, Livepeer participated in a community showcase event hosted by ComfyUI, featuring demos of real-time video workflows powered by Livepeer infrastructure. The event reinforced ties between the AI open-source community and Livepeer’s streaming ecosystem.

Open Ecosystem Call: On March 26, 2025, a community call provided updates on strategic goals, technical milestones, and new contributor initiatives. The call emphasized transparency around project funding, roadmap alignment, and community-led development.

Developer Calls: On Feb. 6 & 20, 2025, Livepeer hosted multiple dev calls to discuss new infrastructure tooling, the status of pending governance proposals, and ongoing developer support efforts. These calls served as checkpoints for coordination among core contributors, grantees, and SPE teams.

Closing Summary

In Q1 2025, Livepeer recorded growth in network usage, AI workloads, and protocol participation. Total transcoded video minutes rose 49% QoQ to 52 million, while demand-side fees increased 51% to $110,000, despite a decline in ETH prices, suggesting increased usage of higher-compute workloads.

AI-related activity generated $53,000 in revenue, or 47.8% of total transcoding fees, up from 10% in Q4. This was driven by the adoption of ComfyStream, Daydream, and developer engagement from the Real-Time Video AI Bootcamp. Ticket volume grew nearly 10x QoQ, though average fees declined due to smaller, more frequent jobs.

Staking participation increased from 42.8% to 48.4%, contributing to a rise in the inflation rate under Livepeer’s dynamic issuance model. Despite a 68% drop in LPT price, staking rewards totaled $18.8 million. A proposal to revise inflation parameters was introduced in February, but had not yet moved to a formal vote.

Governance activity included implementation of treasury process updates via GovWorks. In April, the Livepeer Foundation was announced as a Cayman-based nonprofit to support protocol development and ecosystem coordination. It was formally established in June 2025.