Pendle

We first wrap yield-bearing tokens into SY(standardized yield tokens). Then, SY is split into their principal and yield components, PT (principal token) and YT (yield token) respectively, which allows them to be traded via the custom V2 AMM.

This brings the TradFi interest derivative market (worth over $400T in notional value) into DeFi, making it accessible to all. PT is the equivalent of zero-coupon bonds while YT is the equivalent of coupon payments.

By  creating a yield market in DeFi, Pendle unlocks the full potential of  yield. Pendle enables users to execute advanced yield strategies, such  as:

• Long assets at a discount
• Fixed yield for low-risk, stable growth
• Long yield
• A mix of any of the above strategies