Yield tokenization, explained in a few sentences:
Pendle first wraps yield-bearing assets into standardized SY tokens, then splits SY into principal tokens (PT) and yield tokens (YT).
Each has a different use: buyers seeking a predictable yield buy PT to lock in a rate, while those expecting yields to rise buy YT for exposure to the yield.
Before buying PT, understand what the underlying asset is: if it depegs or its smart contract is attacked, the asset you can redeem at maturity may also be affected.
$PENDLE 2.052 (+5.88%)
Pendle first wraps yield-bearing assets into standardized SY tokens, then splits SY into principal tokens (PT) and yield tokens (YT).
Each has a different use: buyers seeking a predictable yield buy PT to lock in a rate, while those expecting yields to rise buy YT for exposure to the yield.
Before buying PT, understand what the underlying asset is: if it depegs or its smart contract is attacked, the asset you can redeem at maturity may also be affected.
$PENDLE 2.052 (+5.88%)