Many market participants in 2023 were well aware of Pendle’s success. The native $PENDLE token surged some ~2,000%+ and TVL climbed from just $15M to $270M. This can be attributed to key actions including expanding to BNB Chain and Arbitrum, by partnering with Thena and Camelot DEX, respectively. Initiatives including Pendle Earn and Pendle Academy helped to both simplify and educate users on the protocol’s offerings. Along the way, the project secured key integrations and acquired grants including Arbitrum’s STIP and Mantle’s Ecosystem Grant.
Now, this success is continuing into 2024, with the project listing LRTs (Liquid Restaking Tokens) which are already seeing an influx of interest…
This has been a unique use case for the protocol, allowing users to secure future restaking points ahead of time and in bulk by longing LRT YTs (Yield Tokens). The integration of Kelp DAO ($rsETH) and Ether.fi ($eETH) has resulted in a rebound in activity, on Ethereum mainnet nonetheless. At the beginning of the year, Ethereum mainnet and Arbitrum were equal in TVL on Pendle; Ethereum’s TVL is now triple that of Arbitrum. This further showcases the team’s proactive nature thus far and has resulted in total TVL quietly doubling to start the calendar year.
Stay alert, stay informed ⬇
Pendle’s Year In Review
In this report, we will comprehensively analyze the performance and key developments of Pendle, a project that has achieved a remarkable turnaround in 2023. Its growth and dominance in the yield trading sector position Pendle as the market leader and pioneer in maturing the interest rate derivatives landscape in DeFi.
Since the release of V2, Pendle has made significant strides and become a leader in the yield market sector. By building on top of other projects and not relying on a single ecosystem or source of yield, Pendle has managed to capture network effects and provide value to both projects and independent users.
It comes as no surprise that Pendle’s TVL has been in a non-stop uptrend. As Pendle continues to launch new pools, deploy on different chains, and tokenize new yield sources, the protocol is becoming a liquidity hub that can capture a portion of market share across a broad range of sectors, i.e., LSTFi, RWAs, DEX LPs, and more.
Overview
Pendle’s unique approach allows users to tokenize and trade future yields, offering a versatile platform for yield optimization in both bullish and bearish market conditions.
Through a process known as yield stripping, Pendle aims to bring the traditional Interest Rates Derivatives market (valued at over $400T in notional value) into DeFi. By democratizing access to yield markets, users can interact with Pendle to speculate, arbitrage, hedge, or execute advanced strategies to “long yield”, “fix your rates”…
To understand why the development of a yield marketplace is significant for the growth of an ecosystem, it is essential to break down the protocol into its 3 main components:
This architecture offers a great setup from which both projects and independent traders or LPs can benefit.
The projects of the underlying asset can attract more TVL through Pendle. For instance, Michael Egorov is bribing the crvUSD pool on Penpie to reduce borrowing costs on Silo.
Liquidity providers earn yield from a variety of sources:
Yield from the underlying asset.
PT yield (fixed APY).
AMM swap fees.
Extra incentives ($PENDLE emissions, $ARB STIP, rewards from the underlying pool…)
Individual traders can trade yield or fix their rates, an opportunity that was not available to DeFi users before.
If you’re finding this information useful, you can access our full Pendle: Year in Review Analyst Insight for FREE.
Our full 40+ page report goes over the leaps and bounds made by Pendle in 2023, how the team’s efforts resulted in more TVL & Traction, and more.
Click below to get started:
Become a Premium member to unlock all our research & reports including access to our members-only discord server
Join thousands of sharp crypto investors & traders by becoming a Premium Member & gain an edge in the markets. For just $33.25/month you’ll get:
Premium access to the entire Revelo Intel platform
Investor Profiles - Analysis on top crypto investors & their investing performance
Raise Alpha- Weekly reports on interesting project raises
Sector Overviews - 90 day Reports with data and insights on key sectors
Launch Alpha - Weekly report highlighting new projects
The Trace - Real-time onchain alerts for smart money movements
Airdrop Guides - Reports on airdrop opportunities
Members Only Discord server
Analyst Insights reports - actionable trade ideas
Project Snapshots - Monthly protocol-specific performance reports
Project Breakdowns & Timelines - Deep dive 50+ page protocol-specific reports
Notes - Summaries of your favorite podcasts & AMAs