Everything you need to know about yield trading on Pendle. Not finding what you're after? Visit the main app or check out the team page.
Pendle is a yield trading protocol built on Ethereum and several other EVM networks. At its core, it separates the yield component of a yield-bearing token from the principal. This gives you two distinct tradable assets from a single deposit.
Before Pendle, DeFi users were locked into variable yields — you earned whatever the market gave you. The protocol changes that. You can lock in a fixed return today, or take a leveraged bet on yield going higher. Neither option existed before in this form.
Pendle operates across multiple chains: Ethereum mainnet, Arbitrum, BNB Chain, Base, and several others. Each deployment is independent, so liquidity on Arbitrum is separate from Ethereum. When you're browsing markets, the chain selector at the top of the page lets you filter by network.
Base in particular has seen growing activity. If you're looking for lower gas costs on smaller positions, Base is worth considering. The protocol does not charge different fees by chain — the underlying swap fee structure is the same everywhere.
A Principal Token represents the principal portion of a yield-bearing asset. It always redeems for exactly 1 unit of the underlying asset at maturity. Before maturity, PT trades at a discount — that discount is your fixed yield if you hold to expiry.
Think of it this way: if PT-sUSDe with a 90-day maturity trades at 0.97 USDC today, and you buy it, you receive 1 USDC worth of sUSDe at expiry. That 3% over 90 days is your locked-in return, regardless of what the variable APY does in the meantime.
Yield Tokens capture all the yield generated by the underlying asset until maturity. If you hold YT-sUSDe, you receive every bit of sUSDe yield between now and the market's expiry date. The price of YT is typically a fraction of the underlying.
YTs are designed for traders who believe yields will rise. Because you're paying a small amount for exposure to the full yield stream, the leverage can be significant — sometimes 50x to 500x depending on the market. That cuts both ways. If the underlying yield collapses, your YT may expire nearly worthless. They suit experienced traders with a clear view on yield direction, not long-term passive holders.
At maturity, PT redeems 1:1 for the underlying yield-bearing asset. So PT-stETH becomes stETH, and so on. YT stops accruing yield the moment maturity is reached. Any unclaimed yield stays claimable — it doesn't disappear.
You don't have to do anything at exactly the maturity timestamp. Redemption is available whenever you choose after that point. Pendle does not force settlement or impose deadlines on withdrawal.
Pendle uses its own AMM (Automated Market Maker) specifically designed for yield assets. Unlike Uniswap or Curve, this AMM accounts for the time-to-maturity of PT. As a market approaches expiry, the AMM gradually shifts its pricing curve to reflect the converging price of PT toward par.
Liquidity providers deposit into a pool containing PT and the underlying asset (or a stablecoin). In return they earn swap fees, PENDLE incentives, and sometimes additional rewards from underlying protocols. You can view current LP APYs on the Pools page of the Pendle app.
Impermanent loss exists but behaves differently than in a standard AMM. Because PT converges to par at maturity, the "divergence" between PT and the underlying asset is bounded. A PT cannot trade at a discount forever — at expiry it equals 1 unit of the underlying.
This makes the IL profile more predictable than, say, a volatile token pair on Uniswap. That said, if you exit the LP position before maturity and yields have moved significantly, you may experience some loss relative to simply holding. Most LP positions are most efficient when held through the full market duration.
Yes. Many Pendle liquidity pools receive weekly PENDLE emissions voted on by vePENDLE holders. The distribution of rewards shifts each week depending on governance votes. If you want higher PENDLE rewards on a specific pool, you can vote (or have your vePENDLE vote) toward that pool.
Some pools also carry external incentives from the protocols whose assets are listed. For example, a pool containing a stablecoin from Protocol X might also distribute X tokens alongside PENDLE. Check the individual pool card on the app's Pools page for the current reward breakdown.
Pendle has undergone multiple security audits from recognized firms. Smart contract code is publicly available on GitHub for independent review. No protocol, however, is risk-free — smart contract exploits, oracle failures, and governance attacks are real risks across all of DeFi.
The Pendle platform has been live since 2021 and has processed billions of dollars in volume without a protocol-level exploit. That track record matters, but past security is not a guarantee of future safety. Start with amounts you can afford to lose while you're learning the mechanics.
vePENDLE is vote-escrowed PENDLE. You lock PENDLE tokens for up to two years to receive vePENDLE. The longer you lock, the more vePENDLE you receive. It decays linearly toward zero as your lock expires.
Holding vePENDLE gives you three things: governance voting power over pool incentives, a share of 3% of all yield accrued by YT holders across the protocol, and boosted LP rewards in pools you vote for. For active participants who plan to use Pendle long-term, accumulating vePENDLE can substantially increase returns. Visit the sPENDLE section of the app to get started.
Pendle lists yield-bearing assets from major DeFi protocols. This includes liquid staking tokens (stETH, eETH), stablecoins earning yield (sUSDe, USDe), liquidity pool tokens, lending protocol receipts, and various structured products. New assets are listed regularly through governance.
Not every asset on Ethereum is available. The underlying asset must generate yield in a predictable, on-chain verifiable way. Pure governance tokens or non-yield-bearing assets are generally not eligible for Pendle markets.
Pendle supports limit orders for PT and YT trading. Instead of accepting the current AMM price, you set the yield rate at which you're willing to buy or sell. Your order sits off-chain in an order book and gets filled when the market moves to your price.
The platform periodically runs limit order incentive programs. During active incentive periods, placing limit orders in eligible markets earns additional PENDLE rewards — on top of any trade you make. This is a way to earn yield even when your order hasn't filled yet. Check the Markets page for the current list of incentivised pools.
Yes. Pendle connects via WalletConnect and other standard wallet connectors, which means Ledger and Trezor devices work fine when paired through MetaMask or a compatible software interface. Blind signing is not required — all transactions display readable parameters.
For large positions, a hardware wallet is strongly recommended. The protocol does not custody your assets at any point; your tokens remain in your wallet until you explicitly submit a transaction. Learn more about the team's approach to security on the team page.
The primary fee is a swap fee charged on trades in AMM pools. The exact fee varies by market. A portion goes to LPs, a portion goes to the protocol treasury, and vePENDLE holders receive 3% of all YT yield as a protocol fee. There is no deposit or withdrawal fee for entering or exiting LP positions.
Gas costs depend on the network you use. Ethereum mainnet transactions are more expensive than Arbitrum or Base. The Pendle interface displays a gas estimate before you confirm any transaction.
Start with the fixed yield side. Find a PT market for an asset you already hold or plan to hold — sUSDe or stETH are popular starting points. Buy PT at a discount and hold it to maturity. You get back the full underlying asset plus your locked-in yield. No active management needed.
Once you're comfortable with how PT redemption works, explore LP positions for swap fee income. Save YT trading for later — it requires understanding yield forecasting and carries higher risk. The Education section of the Pendle app has detailed guides for each strategy.