The yield aggregator protocol Pendle has recently gained attention. This article will provide a detailed introduction to the investment strategy of locking $Pendle to obtain vePendle and participate in voting.
Index:
Pendle Capital Pool APR Reaches 218%
Details and Benefits of Locking $Pendle for vePendle
Tutorial on Participation
Locking Process
Obtaining Voter APY
Receiving Bribe Rewards
While the overall cryptocurrency market is in a downturn, the interest rate market remains active. Pendle, the yield aggregator protocol, has continued to grow due to the narrative of Ethereum liquidity re-collateralization (LRT) and the popular stablecoin project Ethena. It has achieved new highs in terms of trading volume, TVL, and token price this year.
According to Pendle’s own data, its TVL has exceeded $4 billion, which is nearly 18 times the amount at the beginning of the year ($230 million). At the same time, Pendle’s accumulated trading volume has exceeded $15.8 billion, which has significantly contributed to the growth of platform fee income.
Data from Token Terminal shows that Pendle’s fees surpassed $596,000 in the past week (4/22 ~ 4/28), marking the second-highest weekly income in history. On April 25th alone, the fees reached nearly $205,000. Compared to the fees of other crypto projects reported by Crypto Fees, Pendle’s fee income ranks 7th, between MakerDAO and Kyberswap.
To share in Pendle’s fee income, besides providing liquidity, locking $Pendle to obtain vePendle and participating in voting is an efficient method. The image below shows the top 6 pools in terms of APR for vePendle voters (excluding the sDAI Pool launched just before the deadline), with APR ranging from 71.97% to 218.7%. These earnings are real and paid in ETH at the end of each month.
Users can check all past performances on the website. The following sections will provide detailed explanations of the process of locking $Pendle, the benefits of holding vePendle, and how to participate in sharing fee rewards.
Locking $Pendle means exchanging it for governance rights – vePendle. vePendle allows participation in voting (determining how Pendle rewards are distributed), sharing in fee rewards, and receiving LP reward bonuses. The details of locking $Pendle for vePendle are as follows:
The quantity of vePendle decreases weekly as the lockup period approaches its expiration date until it reaches zero at the end of the lockup period (meaning all vePendle will be unlocked and converted back to PENDLE).
Unlocking vePendle early is not possible, but the lockup period can be extended to increase vePendle.
The maximum lockup period is 2 years.
The benefits of holding vePendle include the following:
3% fee from YT interest extraction + unrealized PT earnings until expiration. Paid in ETH.
Voter APY: Receives 80% of the fees from the voted pool.
Paid in ETH, which is the goal of this article.
Bribe rewards from third-party protocols for voting on pools.
LP reward bonus: A portion of the LP rewards is Pendle rewards, which can be boosted up to 2.5 times. If the pool has other “Boostable” earnings, they can also be boosted up to 2.5 times, depending on the amount of vePENDLE held.
When locking $Pendle, users will see two earnings for vePendle. One is the vePendle Base APY, which reflects the first benefit mentioned. This is added to the earnings from voting for the pool with the highest APR, known as the Voter APY, and is the vePendle Max APY.
The trend chart for these two earnings can be viewed on the Community Dashboard. Additionally, users can check various data such as the latest Voter APY and vePENDLE lockup status for each pool.
To lock, increase, or extend the lockup period for $Pendle, visit the Pendle lockup page.
On the Pendle voting page, select pools with high Voter APY for maximum earnings by clicking Revote. Voter APY is paid out once at the end of each month in $ETH, and users can claim it on their own data panel (Base APY can also be claimed on this page).
It is important to note that the displayed APY only reflects the past 7 days’ performance and may not be indicative of the future. All past performances can be viewed on the website.
To see the weekly voting bribe rewards, visit the Equilibria or Penpie websites. Users who have voted for bribes can claim their rewards on these websites over the weekend.
This concludes the tutorial on obtaining Pendle fee sharing and the rewards from holding vePendle. Pendle Chinese Community Ambassador ViNc reminds users that if there are no changes to the voting options, there is no need to vote every week. Furthermore, these operations can only be performed on the Ethereum mainnet, and users should evaluate the feasibility if their funds are too small for the gas fees.
Related Articles:
PENDLE Soars: Ethereum Re-collateralization Remains Hot, Ethena (ENA) is Involved?
Understanding the Yield Aggregator Protocol Pendle: Connecting to RWA Market, Multi-chain Expansion
Binance Announces Investment in Yield Aggregator Protocol Pendle Finance, $PENDLE Surges 12%
Seize Profits from Market Volatility! Analyzing the Arbitrage Opportunities of Pendle YT