Binance announced on July 3 that its Innovation Zone would list Pendle at 18:00 UTC, marking its 35th Launchpool project. Mining activities began on July 4 at 08:00 UTC.
Here’s a comprehensive breakdown of Pendle’s ecosystem and tokenomics:
What Is Pendle?
Pendle is a permissionless yield-trading protocol enabling users to execute diverse yield-management strategies. Its architecture splits yield-bearing assets into:
- Principal Tokens (PT): Offer fixed yields.
- Yield Tokens (YT): Provide variable returns.
Users can trade these tokens on Pendle’s v2 Automated Market Maker (AMM) to optimize earnings.
PENDLE Token: Core Utilities
The native PENDLE token powers the protocol through:
Liquidity Incentives
- Rewards distributed to liquidity providers to bootstrap ecosystem growth.
Governance (vePENDLE)
- Users lock PENDLE for up to 2 years as vePENDLE to vote on emission allocations across pools.
Revenue Sharing
vePENDLE holders earn fees from:
- 0.3% swap fees on Pendle AMM transactions.
- 3% of yields generated via YT, fully redistributed to vePENDLE stakers.
Pendle’s Technical Framework
The protocol integrates:
Yield Tokenization:
- Converts yield-bearing assets into Standardized Yield Tokens (SY), then splits them into PT and YT.
v2 AMM Design:
- Enables capital-efficient swaps between PT and YT using flash-loan mechanics within a single liquidity pool.
Funding and Tokenomics
- Seed Round (April 2021): Raised $3.7M (14.9% of supply) at a $35M FDV.
Supply Metrics (June 2023):
- Total Supply: 251M PENDLE.
- Circulating Supply: ~140M (56% of total).
Emission Schedule:
- Weekly distribution: 455,000 PENDLE (decreasing 1.1%/week until April 2026).
- Post-2026: 2% annual inflation for ongoing incentives.
FAQs
1. How does Pendle’s yield tokenization work?
Pendle wraps yield-generating assets (e.g., stETH) into SY tokens, then divides them into fixed-yield PT and variable-yield YT for trading.
2. What’s the advantage of holding vePENDLE?
Locking PENDLE grants governance rights and a share of protocol fees, creating passive income opportunities.
3. Is Pendle’s AMM similar to Uniswap?
While both facilitate swaps, Pendle’s AMM optimizes for yield-bearing assets and uses flash swaps to enhance capital efficiency.
👉 Explore more DeFi innovations with Pendle