Fluffpuffs

A rather strange creature, specifically bred with both magic and traditional means to increase the wool output of what was once rumored to have been a sheep, the fluffpuff is easily mistaken for a ball of wool on first look.
The original breed, which much more closely resembled an actual sheep, was already quite a swift producer of wool. Known as puffsheep, they are still raised in quite a large portion of the Riftgrounds, though they don't fare well in too hot of climates. But for some, even these sheep didn't produce enough product for the space they required.
Over the decades of modifications, they were made smaller and smaller so they would take less space and food, while keeping their wool input up as much as possible. Eventually, after more than two centuries and magical modification and careful breeding, the creature was perfected, and the perfect ration was found: a creature whose mass is almost entirely wool.
They are primarily kept by some of the Arcane Elves in the northern sides of their home regions, as well as a few of the snow dwarves. A select few have been imported as far east as Undyr, though there they are only kept as rare and exotic pets, rather than a goods producing farm animal.
While widely considered to be adorable, as well as quite lucrative to those who farm them, these changes are not without their repercussions. The sheer volume of wool means they can only be kept it rather cool climates, lest they overheat, and the speed at which their wool grows means they requires someone to care for them actively, or they can grow so much fluff they can't even move effectively.
Despite this, as far as anyone can tell, well cared for fluffpuffs in cold climates such as Undyr or Snowfield are perfectly able to live healthy, happy lives.