🔥 On-chain fund tracking of Pendle shows that there are continuously traders quietly building positions in batches at low points.
As a new toy in the DeFi world, its yield performance is quite impressive. In the context of generally low market interest rates, Pendle’s mainstream stablecoin strategy can achieve an annualized yield of up to 12.4%, far exceeding the industry average (like Aave at about 3.4%), attracting a large amount of profit-seeking capital and liquidity. This project supports yield separation and flexible yield strategies, with a solid infrastructure and pioneering functionality in the industry.
1. The innovation of the project lies in dividing assets into principal (PT) and yield (YT) components. PT acts as a stable investment tool to withstand market fluctuations, helping users lock in fixed returns; YT is a leveraged tool full of opportunities and risks. The price of YT is influenced not only by the returns of the underlying asset but also by market dynamics. In traditional financial markets, interest rate trading is already very mature. For decentralized exchanges, this may be the next step—a milestone in spot/contract trading of interest rates.
Specific gameplay can be seen on Twitter from this teacher @ViNc2453. More and more DeFi protocols are innovating based on Pendle. Many arbitrage strategies have already utilized PT/YT.
2. Community and Investment
① High social heat: Recent discussions about Pendle have surged, and the community recognizes its innovation and resilience, listing it as a DeFi blue chip, alongside Uniswap, Curve, etc. Both the team and the product have received high praise.
② Accumulation of smart money: 'Smart Money' has been pouring in, with LSTfi and TVL recovering, and during corrections, it is seen as a quality target.
③ Investment institutions: Gained investment from well-known capitals like Mechanism Capital and LedgerPrime.
3. Ecological Development
① Supports over 200 types of stablecoins. Deep collaboration with leading DeFi platforms like Aave and Morpho, with TVL reaching $4.42B. It has become the center of the DeFi yield track.
② Extremely high community participation, many KOLs, mainstream institutions, and smart money continue to increase holdings (especially during price corrections), with high discussion activity on social platforms. External analysts and rankings have been in a positive evaluation range for a long time, forming a high consensus and active cycle. Solutions compliant with traditional and Islamic finance are being developed, with potential access to more mainstream and special financial markets.
③ Continuous innovation and expansion: Rapid product iteration, actively embracing cross-chain and real-world asset (RWA) directions, and expanding into traditional financial markets (TFI) and compliant markets, aiming to become a global benchmark for yield derivatives.
4. Growth Potential
① The total global interest rate derivatives amount to $558 trillion, and Pendle is committed to 'DeFi-ifying' this massive market, offering significant long-term growth potential.
② From 2024, TVL is expected to achieve rapid breakthroughs, with mainstream exchanges already listed and continuous product innovation encouraging user participation.
👊 With its innovative yield tokenization mechanism, cross-chain and RWA expansion, strong ecological partnerships, institutional productization, and risk control capabilities, Pendle is expected to maintain a leading competitive advantage in the DeFi yield derivatives market, possessing the potential to attract institutional and mainstream capital. However, it is significantly affected by macro market conditions, and attention should be paid to technical and market risks.
Although short-term market volatility and regulatory uncertainties remain challenges, in the medium to long term, Pendle is highly likely to become the absolute leader in this domain and lead the next phase of explosive growth in DeFi yields and interest rate products. It is recommended to build positions in batches; once it breaks 4, it will be a significant rebound.