Pendle DeFi Faces TVL Drop, New Catalysts on the Horizon

• Pendle DeFi’s TVL dropped 42% due to maturing restaking pools, leading to lower yields and shifting ETH.
• Upcoming catalysts like ETH ETF and Pendle v3 aim to boost Pendle’s TVL and market position.

Pendle DeFi’s Total Value Locked (TVL) has slumped dramatically. Pendle’s TVL was noted at $6.18 billion as of June 27, but it has dropped 42% to $3.6 billion since then. This article explores the causes of this notable drop, forthcoming Pendle catalysts, and the yet-unrealized possibilities in the protocol.

[Is $PENDLE Over? Should We Buy the Dip?]

TVL crashed? What happened?@pendle_fi saw a 42% decrease in its TVL, dropping from $6.18 billion on June 27 to $3.6 billion currently.

The decrease in TVL is mainly attributed to certain liquid restaking market pools maturing on June… pic.twitter.com/aFda3whlac

— Yieldinator (@yieldinator) July 3, 2024

TVL Crashes: What Happened?

Pendle’s TVL drop results mostly from maturation of some liquid restaking market pools on June 27. Many players left the point-farming game at this stage due to their disapproval of the approaching LRT airdrop.

As a result, the indicated yield for Principal Tokens (PT) has dropped as demand for Yield Tokens (YT) has decreased; today, it ranges roughly 6%. PT assets have become less appealing due to this reduced income, which has some users switching their ETH to other protocols.

Pendle has good signals ahead despite the slump. One interesting point is that MCAP/TVL is still regarded as a key valuation tool by the market. Pendle’s TVL will probably climb in line with any future increase in its price. Several upcoming factors are about to revive Pendle’s chances.

First of all, the expected ETH ETF can generate fresh curiosity. Pendle v3, which will bring leveraged yield trading, also looks to be a game-changer when it releases. Moreover, the Symbiotic + Mellow Protocol story is evolving and might provide the platform even more fresh ideas.

Potential and Market Position

Pendle stays ranked No. 9 in terms of TVL among all DeFi protocols, despite the latest difficulties. Its market cap (MCAP), however, puts it below the Top 100 and emphasizes the unrealized possibilities in the protocol.

This disparity between TVL and MCAP highlights development potential, especially if future catalysts effectively increase user involvement and TVL expansion.

Meanwhile, Pendle’s native token, PENDLE, is valued at about $4.06 right now. The coin has demonstrated a bearish trend over the past seven days, with a 23.97% drop, but over the last 24 hours it has increased by 1.28%.

Although this decrease reflects both the recent TVL collapse and more general market mood, it also prepares the ground for possible rebound when fresh events transpire.

Adding a layer of hope, prominent players in the crypto scene, such as Arthur Hayes, have voiced positive opinions on Pendle. Hayes’ optimism, which CNF had previously reported, extends to Pendle and Dogecoin (DOGE), suggesting that Pendle still has hope for the future despite the current market’s challenges.