Today in Markets

Pendle's January Revenge

The hot DeFi protocol has gone parabolic on its liquid restaking plays.
Jan 30, 20242 min read

Pendle had an epic January, and the token price was reflective of its success; PENDLE is up 138% on the month! What trending narrative has unleashed a wave of Pendle demand?

Last year, Pendle steadily increased its TVL to $235M to meet demand from token holders seeking a low-risk way to amplify their returns on yield-bearing collateral. Growth was supported by Pendle’s multi-chain expansion and its Arbitrum deployment, in particular, which launched last March and currently holds over $100M in locked value.

Although Pendle grew at a respectable pace in 2023, TVL has skyrocketed to new highs and gone parabolic to start the new year, increasing by 135% to $552M🚀

Source: DefiLlama

While a portion of this growth comes from existing markets, a substantial percentage of the increased demand for Pendle's yield-splitting products is attributed to the newly established rsETH and eETH pools, which now boast a combined TVL of $250 million!

Pendle has been played in LSTfi, and the rise of restaking has translated into an opportunity for the Protocol to become an integral component in LRTfi!

As a yield-splitting protocol, Pendle offers LRT holders a way to monetize their potential airdrop rewards at a market value in the form of a fixed yield while allowing speculators to purchase the yield stream (which includes any airdrops that are disbursed prior to the maturity of the pool) to lever up on potential EigenLayer and LRT airdrop returns.

Unfortunately, demand for Pendle likely tapers off after the EigenLayer airdrop occurs, as lower yields equate to less speculative activity, but until then, Pendle is well situated to benefit from speculation on restaking airdrops and stands to effortlessly grow TVL as the circulating supply of LRTs increase and holders seek out extra yield on their tokens.


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