August 28, 2023

DeFi is not dead: Pendle Finance scores with Binance Labs’ backing

1. ScopeVC’s Morning Buzz

Each dawn, VC research analysts that work with ScopeVC kick off their day looking at the Discover project’s tab. And today, there’s a clear headline: Binance Labs, the investment behemoth, has bet big on Pendle Finance.

2. Pendle Finance: A Glimpse

Let’s unravel Pendle’s allure. Pendle is a yield trading protocol that allows users to tokenize and trade future yields by leveraging top yield-generating protocols such as MakerDao, Aave, Compound, and Wonderland. This DeFi gem has not only attracted top-tier previous investors but has also showcased commendable metrics. With its TVL soaring to a staggering $153.49M before stabilizing at about $128.55M, and a token price that refuses to settle, Pendle’s rise in the DeFi arena is undeniable. And tools like ScopeVC only validate its ascent.

3. The Bigger Picture: Why Pendle?

Binance Labs backing Pendle isn’t just about dollars; it’s a statement: DeFi isn’t bowing out. Yes, DeFi isn’t without risks. But where else can you find an investment avenue promising lucrative returns over traditional counterparts? The real magic of DeFi? Its potential to lure investors with yields that traditional instruments, like the >5% T-Bills, can’t touch.

Peel back another layer, and you’ll find:

  • Crypto, via platforms like MakerDAO, is buying bonds. The interest? It’s smartly funneled back to the on-chain users.
  • The fusion of conventional financial tools with cutting-edge on-chain tech, allowing seamless access to real-world assets minus the paperwork.
  • A golden chance for investors to get exposure to different financial instruments that are inaccessible in TradFi
  • Binance Labs, and peers, are looking beyond the obvious. Their vision isn’t restricted to just liquid staking derivatives (LSDfi). The true allure? DeFi’s evolutionary path, especially when interest rate derivatives dance with real-world assets.
  • The future? Platforms like Pendle and MakerDAO’s sDAI melding seamlessly. While they’re still dwarfed by traditional finance, they’re showing glimmers of the innovation that lies ahead.

4. Peering into Tomorrow’s Opportunities

Pendle’s innovation? Making the $400T-valued (source: ISDA) interest rates derivatives from the traditional world accessible in DeFi. And with Binance Labs’ nod, their approach of dissecting yield-bearing assets, especially in the LSDfi sector, is turning heads.

The playbook is unfolding. DeFi’s merger with age-old financial derivatives, the embrace of crypto for tangible financial tools, and the relentless quest to bridge the traditional with the on-chain is a treasure trove of opportunities. The horizon is brimming with promise, and it’s in this amalgamation of old-world charm and new-age tech that the next jackpot awaits.

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