Pendle and the 3 Joesephs
Maximum capital productivity!
The first Pendle integration is everyone’s favorite supermart, Trader Joe! PENDLE is available on Trader Joe, here. This partnership is our first port of call in Avalanche.
Trader Joe is a DeFi cornerstone that has amassed over $2 billion in TVL! We will be starting off with support for 2 assets:xJOE and PENDLE/AVAX LPs. With Pendle, users will be able to lock yields of the supported assets, build leveraged yield exposure, and even purchase the underlying assets at a discount.
The 3 Joesephs
Hedgooor Joe
xJOE yield is attractive but fluctuates over the year. What if you could lock in that yield today and not have that uncertainty? Even better, you receive the yield upfront in USDC!
With Pendle, you can be the ultimate hedgooor.
The process is simple: Pendle can be used to split xJOE into Ownership Tokens (OT) and Yield Tokens (YT).
The YT can be sold to lock in the yield, while OT is a comfy hold until expiry where it can be redeemed for an equivalent amount of JOE 1:1.
Uponly Joe
For yield-bulls, YT-xJOE can be obtained on Pendle to benefit from any increase in xJOE yield. YT is capital efficient by design, allowing you to gain higher levels of yield exposure with the same amount of capital. More yield exposure without liquidation risk!
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Discount Joe
Discount Joe wants VALUE. VCs only buy at a discount, he should too!
Well, OT-xJOE is always available at a discount to JOE. This is the simple formula they don’t want you to know about!
JOE = OT-xJOE + YT-xJOE.
Imajin buying OT-xJOE at a 30% discount to xJOE. Redeemable for JOE 1:1 after expiry!
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PENDLE / AVAX LPs
For LP tokens, Pendle can also split them into Ownership tokens (OT) and Yield tokens (YT).
YTs represent ownership of the swap fees. This allows users to speculate and hedge on LP swap fees.
Similar to xJOE tokenization, with Pendle you can choose to:
- Hedge. Split your LP tokens into YT and OT. Sell the YT away to guarantee your yield.
- Long only. Purchase YT-LP tokens to obtain pure yield exposure. This is useful to speculate on high volatility periods where LP tokens generate the most yield from swap fees.
So…. Wen ape?
Pools will go live on 11 Nov 2021. Stay tuned for more updates on our Discord and Twitter.
For a recap, here’s our previous Avalanche announcement: Pendle on Avalanche
About Trader Joe
Trader Joe is a one-stop-shop decentralized trading platform native to the Avalanche blockchain. Trader Joe builds fast, securely and aims to serve the community at the frontier of DeFi. The long-term vision of the team is to make Trader Joe an R&D-focused platform for new DeFi primitives not yet seen on any blockchain.
