Pendle Receives 2 Million ARB Grant from Arbitrum
The Arbitrum Short-Term Incentives Program (STIP) is an initiative organized by the Arbitrum DAO to stimulate liquidity across its ecosystem. As previously reported by Coin68, a budget of 50 million ARB will be allocated to 29 projects that met the quorum of 71.51 million ARB and received more than 50% approval in voting.
Among the projects in various domains such as DEX, Derivatives, and Lending, Pendle Finance (PENDLE) stands out in the Yield category. Pendle had proposed that Arbitrum fund 2 million ARB for its liquidity rewards plans. In the community vote, Pendle received 97.65% approval, with a total of 137.9 million ARB cast.
Funding Details
According to Pendle's application on September 27, 2023, the grant from Arbitrum STIP will be utilized from October 2023 (once received) until January 31, 2024. The goals are to:
- Increase yield trading volume
- Stimulate platform activity
- Boost liquidity in existing pools and provide incentives for new market liquidity on Arbitrum
- Encourage activity for other protocols built on Pendle
During this period, Pendle aims to achieve three primary objectives:
- Double its Total Value Locked (TVL) from the current $46 million to $80 million.
- Increase average monthly trading volume from $13 million to $20 million.
- Raise the number of monthly platform users from 5,000 to 8,000.
Allocation of Funds
The 2 million ARB grant will be allocated as follows:
- 1,100,000 ARB (55%): Distributed to liquidity pools on Arbitrum in weekly phases to enhance liquidity. Each pool represents different assets with varying yields, and Pendle will collaborate closely with partners like Lido, GMX, Gains Network, RocketPool, Camelot, HMX, Stargate, and Penpie.
- 800,000 ARB (40%): Allocated for various campaigns on Arbitrum to boost activity and trading volume. Monthly campaigns will be updated to attract users, with ARB rewards for top traders by trading volume and net P&L.
- 100,000 ARB (5%): Used as rewards for users exploring and experiencing new protocols integrated into the Pendle ecosystem on Arbitrum, encouraging users to increase their holdings in Pendle assets.
About Pendle Finance
Pendle Finance is a DeFi protocol on Ethereum that allows users to tokenize and trade future yield from staked assets through an AMM mechanism. It enables users to implement various strategies to maximize returns from their assets.
Pendle was the 35th Launchpool project on Binance, and on August 23, 2023, it received a strategic investment from Binance Labs. Binance Labs' investment reaffirms its commitment to nurturing advancements in the crypto market and helps Pendle extend its yield optimization strategy across multiple ecosystems, offering capital optimization opportunities for both individual and institutional investors.
Most recently, Pendle has launched products based on Real World Assets (RWA), a highly promising narrative. Both its RWA and Fixed Yield products support sDAI from Spark Protocol and fUSDC from Flux Finance.
Conclusion
The grant from Arbitrum represents a significant boost for Pendle Finance, providing it with the necessary resources to enhance its platform's liquidity and user engagement. This move is expected to further solidify Pendle's position in the DeFi space and contribute to the overall growth of the Arbitrum ecosystem.
