Pendle is coming to HyperEVM.
You need to know:
1. How it works
2. How to play the Pendle bonanza
3. Maximising rewards
I will be doing a series of educational threads to guide you on HyperEVM.
Tutorial 1 👉 An introduction to yield optimisation
🧵
Pendle solves two prevalent problems:
1️⃣ People want reliable fixed yields
2️⃣ People don't have enough capital and get crowded out by whales when points farming
Pendle creates a market for both of these participants to express their view and lets you earn better yields to help you secure better certainty.
But how? 👇
Pendle takes in a yield bearing token (i.e. $hbUSDT) and splits it into two parts:
🔵 Principal token (PT): The principal amount (i.e. 1 $USDT)
🟢 Yield-token (YT): The yield-receivables of $hbUSDT (i.e. The APY and points being earned)
PT and YT can be traded via Pendle’s AMM. By creating a yield trading market in DeFi, Pendle unlocks the full potential of yield, enabling users to execute advanced yield strategies.
Ok but what does this actually mean? 👇
It means that:
If you want FIXED yields, buy the PT token 🔵
If you want more points and yield exposure, buy the YT token 🟢
Fundamentally, that is how most users need to decide on which one to buy and what they actually want.
Please explain with an example ser 👇
800.HL is bullish on Hyperbeat.
He feels he doesn't have enough Hearts in his portfolio.
He goes to Pendle and buys the YT token 🟢
This gives him leveraged exposure to the yield and points accruing to the $hbUSDT vault.
Ok but what if I want fixed yield? 👇
700.HL just wants fixed yield on his stablecoins, but doesn't care about the points associated with it.
He goes to Pendle and buys the PT token 🔵
The price of the PT token trends to 1 at maturity, which represents a fixed, reliable yield he can earn by buying PT token now.
So 700.HL has a reliable way to earn yield by doing this, but he forfeits his points in doing this since it accrues to YT.
Ok but if I want both of these? 👇
600.HL wants both the fixed yield and the Hearts exposure.
He goes to Pendle and provides liquidity into the Pendle AMM and gets exposure to both YT and PT, which gives him the best of both worlds.
In addition, he earns swap fees and gets to chill and watch the others do their thing.
Ok bro, I think I get it but then how should I trade this thing? 👇
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