DeFi Raiders X Pendle Fi

Introduction

In this section, the host introduces the guest and welcomes them to the show.

Guest Introduction

• The guest is TN, CEO of Pendle.

• The host welcomes TN to the show.

Background and History of Pendle

In this section, TN talks about his background in crypto and how he started Pendle.

TN's Background

• TN started in crypto professionally when he joined Khyber as one of the founding team members in 2017.

• He stayed on there until 2019 and learned a lot from it.

• After leaving Khyber, he gathered a group of people who are now co-founders of Pendle to look into various opportunities.

• One of their first projects was a mining software that focuses on using FPGA to mine certain privacy coins. However, it wasn't very successful due to the bear market in 2019.

• They decided to move on from that adventure and focus more on building and providing consultancy services to a host of player ones.

Idea for Pendle

• During D5 summer in 2020, they were farming tokens with attractive APY rates but realized there was no way they could lock in those rates.

• They made a comparison to the financial sector and realized that fixed rate components were largely absent in crypto at that time.

• Their thesis was that there would continue to be more money flowing into the crypto ecosystem, making fixed rates more prominent over time.

• They started ideating solutions to offer fixed-rate products native to D5 which led them to create Pendle.

What is Pendle?

In this section, TN provides an overview of what Pendle is all about.

Definition of Pendle

• Pendle is a protocol that enables the tokenization and trading of D5 yields.

• Users who want to obtain fixed rates can do so on Pendle, while traders who want to speculate on yield can also do so on Pendle.

Benefits of Pendle

• Pendle offers fixed-rate products native to D5 which were largely absent in crypto at that time.

• It allows users to lock in attractive APY rates for a certain period of time.

• Traders can speculate on yield by going long or short on the yield.

Conclusion

In this section, the host concludes the show.

Final Thoughts

• The host thanks TN for joining the show and providing valuable insights about Pendle.

• They discuss the need for fixed-rate yields to drive mass adoption in crypto.

Introduction to Pendle

In this section, the speaker talks about how he wishes he had a simplified explanation of yield stripping and Pendle when he was first learning about it. He also asks the speaker about successful strategies for using Pendle.

Successful Strategies for Using Pendle

• Providing liquidity is an easy way to participate in the protocol and earn yield. The base APY on panel pools is generally higher due to the way the AMM is designed.

• Example: SDE pool on Pandora offers 10%, but if boosted with vePendle, it can go as high as 20-25%.

• Obtaining assets at a fixed rate involves purchasing the principal token (PT). This achieves the same purpose as earning products on centralized exchanges.

• Users can acquire PT today, hold it until maturity (e.g., 90 days later), and withdraw their asset from the pool with guaranteed fixed rates.

• Compared to earned products like Buy Bit Earn or Cool Coin Earn, which offer only 1.5-2.2% fixed yield, Pendle's fixed yield can go as high as 7% for some pools.

Yield Trading and Pendle V2

In this section, the speakers discuss yield trading and its potential for attracting traditional finance players into crypto markets. They then transition into discussing upcoming features in Pendle V2.

Upcoming Features in Pendle V2

• One of the most significant changes in V2 will be adding support for non-fungible tokens (NFTs).

• Another feature will be allowing users to create custom pools with different weights between protocols.

• There will also be improvements made to user experience and interface design.

Conclusion

Overall, providing liquidity and obtaining assets at a fixed rate are two simple ways users can participate in the Pendle protocol and earn yield. Pendle V2 will bring exciting new features, including support for NFTs and custom pools. Yield trading has the potential to attract traditional finance players into crypto markets.

Yield Tokenization and AMM Design

In this section, the speaker explains how yield tokenization works in Pendle's liquidity pools. They also discuss the benefits of their new AMM design.

Yield Tokenization

• Users depositing a yield-bearing asset into a Pendle pool will receive rewards from the underlying protocol without suffering any opportunity costs.

• Pendle V2 allows users to trade PT and YT assets against the same pool, consolidating exposure into a single pool.

• The contract layer allows for permissioned assets on Pendle, which enables developers or protocol token issuers to list their yield-bearing assets.

AMM Design

• The new AMM design supports trading of PT and YT in a single pool.

• Simple UI and Pro UI cater to both novice and experienced traders.

Stacking Yields on New AMM

In this section, the speaker discusses stacking yields on top of each other using Pendle's new AMM.

• There is no technical restriction on building yield on top of yield, but it may not make sense after two layers due to increased risk.

• The probability of errors increases exponentially with more layers between protocols.

Comparison of Pendle's AMM Pool with UniSwap

In this section, the speaker explains how Pendle's AMM pool differs from UniSwap.

Differences between Pendle's AMM Pool and UniSwap

• Pendle's AMM pool functions similarly to UniSwap at the beginning of every pool.

• Over time, the weight of assets in the pool will start shifting because the Pendle pool is composed of a principal token and an underlying asset.

• The principal token appreciates to the value of the underlying asset over time, causing changes in value that are not accounted for in most other AMMs.

• Simply put, Pendle's pool takes into consideration a time element while most other AMM pools don't.

Experimenting with New Assets

In this section, the speaker discusses how they plan to experiment with new assets.

Supporting Different Types of Assets

• There are many different forms of LP tokens and yield-bearing assets in the crypto ecosystem.

• So far, Pendle has only supported yield-bearing assets from money markets and vaults.

• Other forms of LP tokens include those from AMMs and yield-bearing assets from liquid wrappers or lockers.

• Very "degen" assets like Olympus are also interesting but have not been listed yet.

• The team wants to be open-minded about all these different kinds of assets and experiment on how to introduce them to the community.

PT as Collateral in Money Markets

In this section, the speaker talks about using PT as collateral in money markets.

Feasibility of Using PT as Collateral

• It is definitely feasible because PT is a fully collateralized asset that appreciates in value over time.

• Recognizing PT as collateral allows for leveraged yield trading because trading PT is one of the strategies that a trader can consider.

• If a money market supports PT as collateral, interesting use cases can be seen and earnings can be amplified through leverage.

The Pendle Wars

In this section, the speaker discusses how rappers like Equilibria Magpie and Pin Pie help drive ecosystem development for Pendle.

Role of Rappers in Driving Ecosystem Development

• Equilibria Magpie and Pin Pie are examples of rappers that have launched their own versions of Pendle's protocol.

• These rappers help drive ecosystem development by creating more use cases for Pendle's protocol and increasing its adoption.

V-Panel and Boosting APY

In this section, the speaker discusses the utility of V-Panel for liquidity providers to boost APY. Pendle holders can deposit their tokens into protocols like Pen Pi and Equilibria to generate returns. Liquidity providers who are unwilling to have token exposure but want boosted yield can do so with either of these platforms.

V-Panel's Purpose

• V-Panel has multiple purposes, one of which is for liquidity providers to boost APY.

• Pendle holders who are not liquidity providers can deposit their tokens into protocols like Pen Pi and Equilibria to generate returns.

• Liquidity providers who are unwilling to have token exposure but want boosted yield can do so with either of these platforms.

Benefits for Pendle Holders and Liquidity Providers

• Building on top of Pendle allows assets to be utilized more efficiently.

• This should help with the adoption of Pendle and increase trading volume and TBL.

Narratives Popping Off in DeFi

In this section, the speaker talks about narratives that are currently popular in DeFi, specifically LSD (Liquidity Staking Derivatives), upcoming chains such as Bearer chain mental, ZK ecosystems, and T-Bills.

Popular Narratives in DeFi

• LSD is currently a popular narrative associated with Pendle due to its potential.

• The success of Chapel has removed any technical risks previously associated with the fork.

• People are now more willing to deposit assets into Lido and Rocket for LSD exposure.

Other Potential Narratives

• Upcoming chains such as Bearer chain mental and ZK ecosystems could be interesting for Pendle to have exposure in.

• T-Bills are being tokenized by larger companies and protocols, which could be a potential real-world asset to tokenize.

Trading Yield from Assets

In this section, the speakers discuss the trading of yield from assets and its potential opportunities.

Opportunities for Yield Trading

• The speakers find the concept of trading yield from assets interesting and exciting.

• To drive mass adoption, Pendle needs to improve UI/UX and stay on top of trends in crypto.

• The protocol should be made more user-friendly for users without derivative knowledge.

• Staying ahead of trends is crucial in the fast-changing crypto ecosystem.

Collaborations and Partnerships

In this section, the speakers talk about collaborations and partnerships that Pendle has landed recently.

Existing Partnerships

• Pendle plans to deepen its relationship with existing partners such as Aura, Balancer, and Camelot.

• There are many interesting opportunities to explore with Camelot due to their various types of pools and large community on Arbitrum.

Future Chains

• No information provided in this section.

Expanding the Use Cases

In this section, the speaker talks about expanding the use cases of Pendle and investing in marketing growth and business development to reach out to prospective users.

Immediate Horizon for Roadmap

• The focus is on expanding the use cases of Pendle and getting people to adopt it.

• Investing in marketing growth and business development is necessary.

• Providing liquidity, becoming a liquidity provider, earning healthy APIs or trade yields, or getting fixed rates on Pendle are some of the areas that will be focused on.

Barriers for Adoption

In this section, the speaker talks about barriers for adoption and how they need to be resolved to see greater adoption in their protocol.

Narrative Shift

• There are still roadblocks in attracting native D5 users towards safer long-term yields.

• Leveraging positions is difficult without a money market that supports principal tokens.

• Pool size limitation inhibits traders' ability to make an outsized gain even if they are accurate in their assessment of trade strategy.

Importance of Resolving Barriers

• Getting money markets to recognize pts as collateral is important.

• Greater adoption can only take place once these barriers are resolved.

Conclusion

In this section, the speaker concludes by thanking everyone for having him and looks forward to sharing more updates with them in the coming quarters.

Final Thoughts

• The team needs more mature users who are attracted to safer long-term yields.

• It may take time but building it will attract users eventually.

End of AMA

In this section, the speaker thanks the audience for tuning in and ends the AMA.

Conclusion

• The speaker thanks the audience for their time and support.

• The speaker invites new viewers to like and subscribe to help expand their reach.

• The video ends with music playing in the background.