Sorensval

Over a thousand years ago, well before the Worldrend, a well-meaning elderly gnome named Soren spent all of his days in his mountaintop workshop, crafting gifts for the poor children to help them through the winter months. As he was unable to leave his home due to his age and its location, he crafted clockwork mannequins, in bright clothes with bells attached, to help deliver them.
In time, fae and pseudodragons helped Soren to deliver the gifts to Istralar's children - no matter their race. When it was finally time for Soren to pass, a beautiful elf (assumed to be Desna in elven guise by many) helped him empower his ultimate creation - a divine machine that would continue his gift-giving legacy, crafting small gifts to be placed under nearby trees for the fae to deliver. Even now, even without the help of enough fae, small gifts from Soren's workshop appear in the homes of children, from the most twisted drow child to the most virtuous aasimar.
It's become customary for many to place pine trees in their homes for the gifts, and even when too old to receive them, to gift each other things under the pines. More than that, it has become a gift-giving festival, and many celebrate it with the coming of winter. People cover entire towns and cities in bright colours, bells and homages to the mannequins - and to Soren himself. Some older gnomes or shorter members of other races (such as halflings) also dress up as Soren, with his long white beard, and travel around giving even more gifts to those they find, especially in places like Undria and Port Amarin. The trinkets are always minor, but it's enough to make the darker nights feel much nicer.