Pendle

Penpie

Based

2024

Yield

<h4>Pendle positioned itself for the coming restaking wave. This wave is about to hit crypto big time. There’s already the LRTfi space. An LRT is a liquid restaking token. To clarify, EigenLayer (EL) is the force behind everything that’s related to restaking. EL has set up a points system. That’s where Pendle fits in.</h4> 
So, we’re going to take a closer look at what role Pendle has in restaking. 
<h5>Pendle and LRT Protocols</h5> 
Taking part in Pendle’s strategy, sets you up for an EigenLayer airdrop. As already mentioned, EigenLayer has a points system in place for this. By using Pendle’s Yield Tokens (YT), you can make them part of your Point farming strategy.&nbsp; Not only for EigenLayer but also for other LRT protocols. 
So, in that vein, one of the first things Pendle did, was to work together with <a href="https://www.ether.fi/" target="_blank" rel="noopener">ether dot fi</a>. This is a <a href="https://www.altcoinbuzz.io/?s=restaking" target="_blank" rel="noopener">restaking</a> platform. You can restake their native LST (liquid staking token), eETH. This cooperation worked out well for them. It increased their TVL to $78 million in only 10 days. As a result, Pendle finds itself back on spot #22 for TVL among all Ethereum platforms. You can check their current DeFiLlama ranking <a href="https://defillama.com/chain/Ethereum" target="_blank" rel="noopener">here</a>. Since mid-January, Pendle also saw an increase in daily trading volume. See the picture below. 
<img decoding="async" class="aligncenter wp-image-133129 size-large" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-335-app.sentio.xyz_-1024x463.png" alt="Sentio" width="696" height="315" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-335-app.sentio.xyz_-1024x463.png 1024w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-335-app.sentio.xyz_-300x136.png 300w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-335-app.sentio.xyz_-768x348.png 768w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-335-app.sentio.xyz_-1536x695.png 1536w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-335-app.sentio.xyz_-696x315.png 696w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-335-app.sentio.xyz_-1068x483.png 1068w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-335-app.sentio.xyz_-928x420.png 928w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-335-app.sentio.xyz_.png 1920w" sizes="(max-width: 696px) 100vw, 696px"> 
Source: <a href="https://app.sentio.xyz/share/lv18u9fyu1b558xf?from=%22-2M%22&amp;to=%22now%22" target="_blank" rel="noopener">Sentio</a> 
To clarify, to get a decent <a href="https://www.altcoinbuzz.io/?s=airdrop" target="_blank" rel="noopener">airdrop</a>, you need a big ‘Points’ allocation. That’s where Pendle comes to the rescue. You can leverage your capital to earn Points on EigenLayer and RLT protocols. Points farming is on! So, that’s what we’ll be looking at next. Let’s find out how ‘Points’ work on EigenLayer and RLT protocols. 
<h5>How Do Points Work on EigenLayer and Other Liquid Restaking Token Protocols</h5> 
It’s important to understand how Points work on <a href="https://www.eigenlayer.xyz/" target="_blank" rel="noopener">EigenLayer</a> and other LRT Protocols. The whole point is to get maximum use out of the Points and all related protocols. So, let’s first take a look at EigenLayer. 
<ul> 
 <li style="font-weight: 400">On EigenLayer, you can deposit LSTs like stETH or rETH and many more. Now you qualify for ‘Restaking Points’. The more you restake, and the longer, the more Points (EL Points) you earn.</li> 
 <li style="font-weight: 400">The various LRT Protocols have a similar setup. However, they may call their rewards different. For example, <a href="https://www.kelpdao.xyz/" target="_blank" rel="noopener">Kelp</a> uses ‘Kelp Miles’ or ether dot fi has ‘Loyalty Points’. See the picture below.</li> 
</ul> 
<img decoding="async" class="aligncenter wp-image-133128 size-large" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-336-Etherfi-www.ether_.fi_-1024x463.jpg" alt="Ether.fi" width="696" height="315" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-336-Etherfi-www.ether_.fi_-1024x463.jpg 1024w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-336-Etherfi-www.ether_.fi_-300x136.jpg 300w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-336-Etherfi-www.ether_.fi_-768x348.jpg 768w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-336-Etherfi-www.ether_.fi_-1536x695.jpg 1536w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-336-Etherfi-www.ether_.fi_-696x315.jpg 696w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-336-Etherfi-www.ether_.fi_-1068x483.jpg 1068w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-336-Etherfi-www.ether_.fi_-928x420.jpg 928w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-336-Etherfi-www.ether_.fi_.jpg 1920w" sizes="(max-width: 696px) 100vw, 696px"> 
Source: <a href="https://app.pendle.finance/trade/markets/0xf32e58f92e60f4b0a37a69b95d642a471365eae8/swap?view=yt&amp;chain=ethereum&amp;page=1" target="_blank" rel="noopener">ether.fi</a> 
Now, many people expect the EigenLayer airdrop to be the mother lode of all airdrops. This may well become the biggest airdrop in airdrop history. Nonetheless, you should play your hand smartly. So, don’t deposit straight on EigenLayer. Instead, deposit on LRT Protocols. Now you earn EL Points and the Points from the protocol that you use. The protocols will also have airdrops. This way, you secure two airdrops at the same time. 
<h5>Farming Strategies Based on Your Risk Profile</h5> 
Pending on your risk tolerance, you can base your strategies accordingly. There are three options to consider. At the end of the day, you want to earn EL points and Ether Points or Loyalty Points. 
<ol> 
 <li style="font-weight: 400;text-align: left">No risk — You swap your eETH for PT-eETH. A current APY is closing in on 34%. That’s after maturity and sounds like a sweet deal. That may be tempting as well. However, this doesn’t earn you any EL or Ether Points. You can only earn these Points with the YT token. The picture below shows this PT option. <img decoding="async" class="aligncenter wp-image-133127 size-large" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-339-Pendle-app.pendle.finance-1024x463.png" alt="Pendle" width="696" height="315" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-339-Pendle-app.pendle.finance-1024x463.png 1024w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-339-Pendle-app.pendle.finance-300x136.png 300w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-339-Pendle-app.pendle.finance-768x348.png 768w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-339-Pendle-app.pendle.finance-1536x695.png 1536w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-339-Pendle-app.pendle.finance-696x315.png 696w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-339-Pendle-app.pendle.finance-1068x483.png 1068w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-339-Pendle-app.pendle.finance-928x420.png 928w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-339-Pendle-app.pendle.finance.png 1920w" sizes="(max-width: 696px) 100vw, 696px"> <h6 style="text-align: center"> Source: Pendle <a href="https://app.pendle.finance/trade/markets/0xf32e58f92e60f4b0a37a69b95d642a471365eae8/swap?view=yt&amp;chain=ethereum&amp;page=1" target="_blank" rel="noopener">App</a></h6> </li> 
 <li style="font-weight: 400;text-align: center">Low risk — You can provide LP to PT-eETH/weETH. For example, on Penpie. This is a subDAO by Magpie. Now you can farm Points with your ETH. Currently, its APY is 31.48%. Moreover, you also earn EL Points and Loyalty Points. As a bonus, there’s no IL (<a href="https://www.altcoinbuzz.io/?s=impermanent+loss" target="_blank" rel="noopener">Impermanent Loss</a>). The upside potential is larger compared to the no-risk option, described before. See the picture below. <img decoding="async" class="aligncenter wp-image-133126 size-large" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-338-Magpie-XYZ-www.pendle.magpiexyz.io_-1024x463.jpg" alt="Pendle" width="696" height="315" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-338-Magpie-XYZ-www.pendle.magpiexyz.io_-1024x463.jpg 1024w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-338-Magpie-XYZ-www.pendle.magpiexyz.io_-300x136.jpg 300w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-338-Magpie-XYZ-www.pendle.magpiexyz.io_-768x348.jpg 768w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-338-Magpie-XYZ-www.pendle.magpiexyz.io_-1536x695.jpg 1536w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-338-Magpie-XYZ-www.pendle.magpiexyz.io_-696x315.jpg 696w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-338-Magpie-XYZ-www.pendle.magpiexyz.io_-1068x483.jpg 1068w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-338-Magpie-XYZ-www.pendle.magpiexyz.io_-928x420.jpg 928w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-338-Magpie-XYZ-www.pendle.magpiexyz.io_.jpg 1920w" sizes="(max-width: 696px) 100vw, 696px"> <h6>Source: <a href="https://www.pendle.magpiexyz.io/stake" target="_blank" rel="noopener">Penpie</a></h6> </li> 
 <li style="font-weight: 400">High risk — This buying YT-eETH. This is like a leveraged point farming strategy. In this setup, 1 eETH gives you 9.72 YT-eETH. In other words, your rewards are as if you’re holding 9.72 eETH. Furthermore, you receive EL Points and double Loyalty Points. So, in a nutshell, you’re buying Points with this strategy. You’re also longing for yield at 34%. The APR on your eETH is only 2.7%. </li> 
</ol> 
If that rate remains constant, you can lose most of your capital (-99.8%) if the rates remain the same. There’s no real organic yield for your YT tokens.&nbsp; See the picture below. 
<img decoding="async" class="aligncenter wp-image-133125 size-large" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-342-Pendle-app.pendle.finance-1024x463.png" alt="Pendle" width="696" height="315" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-342-Pendle-app.pendle.finance-1024x463.png 1024w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-342-Pendle-app.pendle.finance-300x136.png 300w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-342-Pendle-app.pendle.finance-768x348.png 768w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-342-Pendle-app.pendle.finance-1536x695.png 1536w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-342-Pendle-app.pendle.finance-696x315.png 696w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-342-Pendle-app.pendle.finance-1068x483.png 1068w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-342-Pendle-app.pendle.finance-928x420.png 928w, https://www.altcoinbuzz.io/wp-content/uploads/2024/02/FireShot-Pro-Webpage-Capture-342-Pendle-app.pendle.finance.png 1920w" sizes="(max-width: 696px) 100vw, 696px"> Source: Pendle <a href="https://app.pendle.finance/trade/markets/0xf32e58f92e60f4b0a37a69b95d642a471365eae8/swap?view=yt&amp;chain=ethereum" target="_blank" rel="noopener">App</a> 
So, be careful how you position yourself. The high-risk option is what it says, high risk. Find the right balance for yourself. 
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"> 
 Okay word of warning before we proceed further, we're venturing into some guesstimation territories here with a lot of assumptions. 
 But your approach towards "to YT or not to YT" should be something similar. 
 Here's some back of a napkin calculation: <a href="https://t.co/7fhSbgW1Q4">pic.twitter.com/7fhSbgW1Q4</a> 
 — Pendle Intern (@PendleIntern) <a href="https://twitter.com/PendleIntern/status/1745747537032814800?ref_src=twsrc%5Etfw">January 12, 2024</a>
</blockquote> 
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> 
<h5>Conclusion</h5> 
Last year, in 2023, Pendle positioned itself in the LST market. By doing so, it received a tremendous boost. So, this year, 2024, Pendle is doing the same with LRTs. Pendle will likely receive a similar boost.&nbsp; 
Plenty of LRT protocols are keen to join Pendle. They’re looking for airdrop hunters. This will gain the platform’s massive TLVs. They can get TVL boosts for millions of USD at a time. As soon as yield-bearing tokens come into play, Pendle can play into that. That’s why it fits so well in these LST and LRT narratives. 
As a result, Pendle’s own TVL should keep growing as well. The $1 billion mark should be a realistic option. 
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The post <a href="https://www.altcoinbuzz.io/defi/how-to-farm-yield-in-pendle/">How to Farm Yield in Pendle</a> appeared first on <a href="https://www.altcoinbuzz.io">Altcoin Buzz</a>.

How to Farm Yield in Pendle

Altcoin Buzz

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