Pendle
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Pendle

Pendle Testnet Launch

08 Jun Update: As of June 8th, XYT has been renamed to YT.

Pendle has been deployed on Kovan Testnet! Our protocol is now available for you to experiment with. Check it out here.

Here’s a short guide on using Pendle Testnet.

Pre-requisites: Kovan ETH and Kovan aUSDT

Before using Pendle on Kovan Testnet, you will need Kovan ETH and a yield-bearing token (Kovan aUSDT).

To obtain Kovan ETH, refer to this link.

To obtain Kovan aUSDT, follow these steps:

  • Connect your wallet provider to Kovan network.
  • Obtain Kovan USDT on Aave V1 from https://testnet-v1.aave.com/faucet. Make sure you have enough kETH in your wallet before using the faucet.

To obtain Kovan cUSDT, follow these steps:

  • Connect your wallet provider to Kovan network.
  • Obtain Kovan USDT (Compound) from https://app.compound.finance/
  • Select “Tether” from Supply Markets section
  • Approve Transaction and Faucet Kovan USDT (Compound)
  • Obtain Kovan cUSDT by depositing Kovan USDT (Compound) to Compound Kovan USDT pool

Pendle Key Functionalities

Here are the functions on Pendle and how to use them.

Mint OT and XYT

You can mint Ownership Tokens (OT) and Future Yield Tokens (XYT) by depositing a yield-bearing token (Kovan aUSDT in this instance). OT represents ownership of the underlying and XYT represents the rights to the future yield of the underlying yield-bearing token.

Step 1: Select the Mint tab.

Step 2: Select the desired XYT token pair and expiry.

Step 3: Enter the amount of underlying to be deposited.

Step 4: Approve the transaction on your wallet and mint.

Swap

You can swap XYT tokens against USDT during the Testnet.

Step 1: Select the Swap tab.

Step 2: Select the desired XYT token pair and expiry.

Step 3: Select the base pair and quote pair.

Step 4: Enter the amount of base pair to be swapped against the quote pair.

Step 5: Approve the transaction on your wallet and swap.

Liquidity

You can provide or remove liquidity for the “XYT/USDT” pairs of interest.

Adding Liquidity

Step 1: Select the Liquidity tab and select Add Liquidity.

Step 2: Select the desired Liquidity Pool to be added.

Step 3: Enter the amount of liquidity to be added for the “XYT/USDT” token pair.

Step 4: Approve the transaction on your wallet and add liquidity.

Removing Liquidity

Step 1: Select the Liquidity tab and select Remove Liquidity.

Step 2: Select the desired Liquidity Pool to be removed.

Step 3: Enter the amount of liquidity to be removed for the XYT/USDT pair.

Step 4: Approve the transaction on your wallet and remove liquidity.

Redeem

You can redeem the underlying tokens with OT and XYT. Do note that past expiry, only OT is required to redeem the underlying.

Step 1: Select the Redeem tab.

Step 2: Select the desired XYT token pair and expiry.

Step 3: Enter the amount of OT & XYT to redeem the underlying.

Step 4: Approve the transaction on your wallet and redeem.

Renew

The Renew function is only available for expired XYT pools (the first expiry for this testnet will be on 12th April). This function renews expired contracts and forwards them to the next expiry cycle.

Step 1: Select the Renew tab.

Step 2: Select the desired XYT token to be renewed.

Step 3: Enter the amount to be renewed. Leftovers will be redeemed into the underlying.

Step 4: Approve the transaction on your wallet and renew.

Claim Earnings

The interest (in the form of the underlying) for XYT holders will be accrued on Pendle’s smart contract and can be claimed at any given time.

Step 1: Select the Dashboard tab.

Step 2: Click “Claim All” and approve the transaction on your wallet.

Nearing Expiry (Frozen State)

As XYT contracts near expiry, the market will enter the Frozen State. During this stage, there is a margin of error in the accuracy of token quantity. As such, the following functions will be disabled:

  • Swapping of tokens
  • Addition of liquidity with both single and dual tokens
  • Withdrawal of liquidity with single token

You will still be free to withdraw liquidity with dual tokens. Interest from XYT will still be accrued until expiry.

After Expiry

After the expiry date of the tokens, the contracts enter the Expired State. During this time, no new incentives and interest will be accrued to the LP. Here are some situations and actions you can take after expiry:

Situation 1: If you have LP positions, you can

  1. Remove liquidity of the position held, and
  2. Renew the expired OT to a new expiry or redeem the underlying

Situation 2: If you have expired OT, you can

  1. Renew the expired OT to a new expiry or redeem the underlying

Join Our Community!

That’s the end of our tutorial! We hope you’ll enjoy using Pendle Testnet.

Do follow us on Twitter to stay updated! If you have any questions or feedback, head over to our Discord server to connect with us. We love to hear from you!

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