Inevitable: Why Pendle Is Positioned to Capture DeFi's Three Biggest Waves

This article is brought to you by Pendle.

Yield is one of the oldest ideas in finance. The promise of a return is what convinces someone to lend, invest, or park capital in one place rather than another. Every dollar in the system is, in some sense, looking for yield.

Pendle's thesis is simple: wherever yield exists, Pendle wants to be the place it gets priced, traded, and locked in. The team describes it almost like gravity: a black hole strong enough that no yield, onchain or off, can escape its pull.

Pendle V2 takes any yield-bearing token, like a staked asset or a yield-generating stablecoin, and splits it into two parts: a Principal Token (PT), which lets you lock in a fixed yield today, and a Yield Token (YT), which lets you speculate on or leverage the floating yield. Think of it like separating a bond's guaranteed return from its variable upside, and letting people trade each piece separately.

Boros extends that same idea to a market V2 doesn't touch: perpetual futures funding rates. These are the fees traders pay each other to hold leveraged positions, and they add up to tens of billions of dollars changing hands every year across crypto's perp markets.

Together, V2 and Boros are built to absorb any yield in the system, and the team has identified three specific growth waves they believe will define this cycle: stablecoins, tokenized real-world assets (RWAs), and perps. 

Wave 1: Stablecoins

Stablecoins are the most established product in crypto, and they're still growing. Supply sits at roughly $300 billion as of mid-September 2026, up 14% year over year. The forecasts from traditional finance are aggressive: Citi's base case puts stablecoin supply at $1.9 trillion by 2030, while Standard Chartered projects $2 trillion by 2028, roughly six times where the market stands today.

What makes this wave different from past cycles is who's showing up. Regulation is moving forward, and payment networks and banks are starting to build. A clear example: the Global Dollar Network, the consortium behind Paxos's USDG stablecoin, counts Kraken, Robinhood, Galaxy, and Mastercard among its members, and it has already launched a Pendle market for USDG.

The results were fast. Pendle became the largest holder of USDG on Ethereum, holding 27.9% of its supply, growing from zero to $121 million in under two months. On X Layer, the Pendle USDG market alone makes up 40% of the entire chain's total value locked (TVL).

The Pendle Effect, a term coined by analytics platform Dune, describes the surge in demand a token experiences once Pendle launches PT/YT markets for it.

• At its peak, half of Ethena's TVL, around $7 billion, sat on Pendle.

• On Monad, AUSD markets reached ~$230 million in TVL, with Pendle accounting for more than 78% of the stablecoin's total supply.

• Stable pools on Pendle have generated $6 billion in notional volume this year alone.

The logic for issuers is straightforward: a stablecoin needs somewhere for its holders to actually earn yield, and Pendle has become the default venue for that. Even under JPMorgan's more conservative outlook, where supply doubles, Pendle's addressable market in stablecoins still doubles within 1.5 years, and grows tenfold within four.

Wave 2: Tokenized RWAs

Tokenized real-world assets (RWAs) like Treasury bills, private credit, and other traditional financial instruments represented onchain are the second wave, and arguably the one attracting the most institutional attention right now.

Excluding stablecoins, tokenized RWAs have grown from around $10 billion at the start of 2025 to nearly $39 billion today, almost a 4x increase in under two years. U.S. Treasuries, private credit, commodities, and tokenized stocks have each individually crossed the $1 billion mark. Long-term projections vary widely, from $2 trillion to over $16 trillion by 2030, but even the conservative end of that range implies roughly a 50x increase in under four years.

RWAs have effectively become Pendle's anchor theme in 2026. Of the markets launched this year, 66 are RWA-linked, spanning Treasury bills, private credit, STRC dividend products, tokenized equities, and even compute infrastructure. Some traction highlights:

• $210 million of RWA-backed PTs now sit as collateral on Morpho.

• STRC markets on Pendle exceeded $500 million in TVL in May, with more than $977 million in cumulative volume, the dominant source of activity in the ecosystem this year.

• USDai, which tokenizes compute infrastructure, peaked at $568 million TVL on roughly $2.5 billion of total volume.

• A fund from Partners Group, the $185 billion AUM private equity firm, has just launched on Pendle, signaling the start of another funnel of Pendled assets.

Despite this traction, the team's view is that RWA tokenization is still early. Recent moves from platforms like Robinhood show tokenization is just starting to find genuine product-market fit, and the line separating onchain and offchain finance is blurring quickly as a result.

Wave 3: Perps

The third wave is perpetual futures, or "perps", and specifically, the funding rates attached to them.

Perps have become the closest thing crypto has to a 24/7 market for anything, including equities and commodities. Equity-linked perp open interest now sits above $6 billion, up more than 10x in six months. Trading volume for stocks on Hyperliquid grew from $4 billion to $212 billion this year, and when SpaceX went public, price discovery for its shares actually happened on perp markets before real shares were trading. Traditional finance is paying attention too: ICE (which owns the NYSE) took a stake in OKX and listed its Brent and WTI oil benchmarks there, while Kalshi has launched the first CFTC-regulated perps in the U.S.

However, perp funding rates are volatile, and that volatility gets worse the further you move from crypto's biggest assets. In May, Hyperliquid's funding averaged 14% annualized and Binance's averaged 17.5%. Oil funding is roughly 14 times more volatile than Bitcoin's, flipping between positive and negative on 40% of trading days. Even traders who correctly predicted a price move, like oil falling from $113 to $91 in early April, still gave up significant profits to funding costs along the way.

Individual asset comparisons make the point sharply: on Binance this year, holding a BTC perp cost about $0.03 in funding per $1 of notional exposure. Holding an SK Hynix-linked perp cost $0.35. BTC's daily funding rate moved with a standard deviation of 5%; for gold and silver it was 60–65%; for SK Hynix, 163%. RWA funding volatility is a fundamentally different challenge than anything crypto traders have dealt with before; no desk can safely hold a leveraged position on a cost that swings that hard.

This is the gap Boros is built to fill. It lets traders lock in funding costs, run fixed-return carry trades, or simply take a view on where funding is headed. Boros also recently launched Arbitrage, a tool built with the prime broker CrossEx that turns cross-exchange funding arbitrage into a two-click trade: open the perp position on CrossEx, open the matching Boros position. According to Pendle, live opportunities have consistently landed around 20–40% fixed APR.

As perps scale into a genuine 24/7 global market, funding becomes something every trader eventually has to manage. Right now, there's really only one dedicated venue built for that.

Distribution and Liquidity: Pendle's Edge

PTs are widely accepted as collateral across both DeFi and CeFi platforms, and Pendle's cross-chain PT functionality means that collateral isn't stuck on a single network. Earlier this year, $170 million of PT-USDe was bridged from Ethereum to BNB Chain to be used as collateral elsewhere. For a stablecoin or RWA issuer, launching on Pendle brings distribution alongside yield.

Liquidity is where the improvements over the past year stand out. As of writing, a $50 million swap into PT-sUSDS locks in roughly 4.6% fixed APY with only 0.05% slippage, according to Pendle, an efficiency level that holds up against the deepest markets on major centralized exchanges. The same combination of deep swap capacity and fixed-rate access shows up across Pendle's stablecoin and RWA markets.

Pendle pairs its AMM liquidity with a limit order system, so trades can fill against both simultaneously for the best available price. Underneath sits an algorithmic incentive module (AIM), which automatically allocates PENDLE token rewards across markets. Pendle reports tradable liquidity up roughly 71% year-to-date (from ~350Mto~600M), a 22x improvement in the cost of acquiring liquidity, and token emissions down 92% since the start of the year.

On the AUSD market, floating TVL sits at $130 million while the AMM liquidity pool backing it is just $2.5 million. With limit orders and AIM, a $20 million trade against that pool moves yield by just 0.22%, a level of capital efficiency that used to require billions in TVL.

The Bigger Picture

Each of these three waves (stablecoins, RWAs, and perps) is following its own separate growth curve. But they share the same underlying need: somewhere for yield to be priced, fixed, or hedged.

• A stablecoin that wants to scale needs somewhere its holders can actually earn yield.

• A tokenized fund arriving onchain with a floating rate needs somewhere that rate can be stripped out and fixed.

• A perp on any asset, onchain or off, carries a funding rate, and a funding rate can only be hedged where funding is actively traded.

As each of these markets grows toward the scale analysts are projecting, they're converging on the same infrastructure gap. Pendle's bet is that it's already built to fill it.

Explore fixed yield on stablecoin and RWA markets: app.pendle.finance
Trade or hedge funding rates: boros.pendle.finance

This article draws on Pendle's original "Inevitable" thesis piece, available here. TVL, volume, and market-share figures in this piece are as reported by Pendle.