Top 3 Projects to Watch in the Pendle Ecosystem: Penpie, Equilibria, and Stake DAO
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Top 3 Projects to Watch in the Pendle Ecosystem: Penpie, Equilibria, and Stake DAO
Pendle ecosystem may soon face a PENDLE war.
Navigating Web3 tides with focused insightsAuthor: Leo@LeoAndCrypto
With the rise of the LSD narrative, Pendle has stood out among numerous projects in the LSD sector thanks to its superior project design, team, and token economics. Both the PENDLE token price and TVL have surged dramatically, with the token's value increasing nearly 16-fold (from 0.05 to 0.8) since the beginning of the year.
Yesterday, Binance announced that Pendle (PENDLE) would be listed on Launchpool. As a result, PENDLE spiked above $1.70 within five minutes, rising as much as 76.83%. A major "PENDLE war" within the Pendle ecosystem may be imminent. Below are three notable projects in the Pendle ecosystem, ranked by TVL: Penpie, Equilibria, and Stake DAO.
Penpie
Penpie is a product launched through a collaboration between Magpie and Pendle, designed to provide Pendle Finance users with enhanced yields and veToken benefits. By locking PENDLE tokens, users gain governance rights within Pendle Finance and higher returns.
Penpie allows PENDLE holders to convert their PENDLE into mPENDLE—the Penpie version of the PENDLE token—to earn high yields. Users can lock mPENDLE on Penpie and receive PENDLE rewards. When users convert PENDLE to mPENDLE, Penpie automatically locks the converted PENDLE as vePENDLE within Pendle Finance. This mechanism enables PENDLE holders to achieve greater returns via mPENDLE while also granting them governance rights and higher APRs as liquidity providers (LPs) on Pendle Finance.
The voting power accumulated from vePENDLE held by Penpie is shared among vlPNP holders, allowing them to participate in Pendle Finance’s governance in a cost-efficient manner. They can lock tokens as vlPNP to earn yield.
Holders of vote-locked PNP can receive revenue shares from the platform, influence Pendle Finance governance, and maximize their returns. Similar to vlGMP, users must wait 60 days for vlPNP to fully unlock back into PNP.
Equilibria
Equilibria’s social media bio clearly states: “The first yield amplifier on Pendle, built for Pendle, taking yields to new heights.” Indeed, Equilibria plays the role of “Convex” within the Pendle ecosystem.
To briefly introduce Equilibria: the platform is led by a team of DeFi OGs with years of industry experience, aiming to customize and optimize Pendle Finance to maximize returns for PENDLE holders and liquidity providers. Leveraging the veToken/yield-boosting model adopted by Pendle Finance, Equilibria offers LPs higher yields through ePENDLE—the tokenized, liquid form of vePENDLE—while providing additional rewards to PENDLE holders.
Features of Equilibria
LPs on Pendle can deposit via the Equilibria platform to boost their yields—even if they don’t hold any vePENDLE.
PENDLE holders can convert their PENDLE on the Equilibria platform to receive ePENDLE (a liquid version of vePENDLE), with the original tokens locked on the Pendle platform. In addition to the benefits associated with PENDLE itself, ePENDLE holders can stake for extra rewards and can swap back to PENDLE on DEXs.
Advantages of Equilibria
First, many protocols have already demonstrated that the veToken era has arrived (e.g., Curve/Convex and Balancer/Aura). The vePendle era is coming, and Equilibria is positioning itself to help Pendle grow while achieving strong growth in parallel.
Second, Pendle is bringing trillions of dollars worth of traditional financial interest rate derivatives into DeFi. As a leader in this space, Pendle Finance holds a significant advantage and has the potential to capture billions in TVL, securing a major market share as DeFi evolves. With its innovative approach and commitment to delivering high yields, Equilibria can also drive progress in the DeFi industry.
Finally, Equilibria aims to push innovation forward in this domain. Its goal extends beyond simply creating a “Convex-like” layer on Pendle. Future plans include introducing new features such as a YT market for vlEQB, limit orders for PT/YT trading, and cross-chain infrastructure. As previously mentioned, the Equilibria team consists of seasoned DeFi experts with deep understanding of the veToken model and proven success in developing and operating veToken aggregators.
Stake DAO
In addition to Penpie and Equilibria, another smaller participant in the Pendle ecosystem is Stake DAO. Compared to Penpie and Equilibria, Stake DAO isn't a close affiliate of Pendle but ranks third in terms of holdings and remains a major participant in PENDLE’s veToken economy. Of course, beyond PENDLE, Stake DAO also holds 45,741,301 CRV tokens, representing approximately $36,285,431 in TVL. Here’s a brief overview of Stake DAO.
Like the aforementioned platforms, Stake DAO is a yield-enhancing platform based on the veToken model. Its standout feature is called Liquid Lockers.
Stake DAO’s Liquid Lockers allow users to unlock the utility of their locked tokens (such as ANGLE, FXS, CRV) without sacrificing yield, voting power, or liquidity. Through Liquid Lockers, anyone who provides assets can achieve maximum yield boosts while retaining full voting rights and benefits within the native protocol, along with the ability to increase voting weight, resell assets, and exit liquidity.
Using Liquid Lockers, users lock their native tokens in a locker and receive sdTOKEN in return. For example, users can lock their FXS via Liquid Lockers and receive sdFXS tokens. For every 1 FXS locked, one sdFXS is minted. This structure enables sdFXS holders to vote off-chain via Snapshot once per week on FXS gauge allocations on Frax. The underlying tokens are locked for four years on the native protocol (e.g., Frax) and automatically relocked indefinitely, maximizing reward accrual through this mechanism.
Conclusion
The veToken model has seen many successful implementations. As the DeFi narrative heats up again, yield-enhancing protocols have become a crucial part of DeFi. Pendle, as a strong player in this space, hosts three key ecosystem protocols—Penpie, Equilibria, and Stake DAO—that could soon enter the mainstream and are definitely worth watching.
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