Today, the decentralized financial system is still in large part an Ouroboros. Vitalik noted this once.
They are proof that technology is working. This is very important. However, these revenues are largely a result of the speculative capital that is passed between traders.
Pendle’s protocol, which observed this state-of-affairs, refused to pass judgement, and then just built the most suitable product in order to capitalise on this Ouroboros economy, is a good example.
You want to get a certain yield. Buy Pendle Principal Tokens (PT). Do you prefer to earn points in anticipation of airdrops with big rewards? Buy Yield Tokens (YT). You can do it.
Pendle isn’t the first to create this. This is the TradFi equivalent of interest rate swaps, zero-coupon bonds and forward rate agreements.
Pendle’s DeFi has a very similar structure to these traditional products. In 2024, Pendle grew its TVL levels to $4.4 billion and daily average trading volumes to $96 million — a 20x and 100x increase, respectively.
Pendle’s success is such that, in fact, it is a similar de-facto launchpad to an ICO. But better.
In the weeks before Berachain’s Genesis airdrop, Berachain Pendle Markets had accumulated over a billion TVL in TVLs from users who wanted to trade Berachain assets or game airdrops.
Pendle’s outlook for 2025
Pendle founder TN Lee has announced the big plans of 2025.
The vePENDLE token bribe scheme will be improved with a number of small upgrades, such as dynamic fees and the vePENDLE token bribe.
Pendle has made a significant improvement to its plans for pursuing the largest yield in the crypto world: the perps financing rates.
Part of the broader “Boros” A play on the ouroboros? Pendle is a new initiative that allows traders to trade to obtain perpetual funding rates.
Ethena, for example, could lock-in predictable yields on funding. This means that sUSDe investors would receive fixed annual percentage rates (APYs).
The long-term traders who are trading in the highly volatile perps market, like that of memecoins will be able hedge against perps by locking themselves into a predetermined, fixed funding rates.
Pendle plans an expansion into non EVM chains Solana Hyperliquid and Ton. Solana has an expanding yield trading market. However, it is still small compared to Pendle.
Pendle has finally arrived for TradFi. It’s a simple pitch: “Why stick with 8% yields on a 5-year corporate bond when you can enjoy a 17% WBTC PT yield?”
The team plans to release a KYC-ed product to allow regulated entities and Islamic funds access to crypto yields.
Pendle is on a pendulum swing, which will likely continue to intensify in the next year. Pendle has a radically expanded target market with its expansions into non-EVM chain and TradFi liquidities.
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