Interview with Pendle Co-founder: Yield is the core competitive advantage, the focus is on stablecoins currently

This week, Pendle co-founder TN Lee shared a post reflecting on the key achievements Pendle has made during the first half of 2025:

• TVL increased by 23%, reaching a new high of $5.29 billion;

• More than 70,000 new users joined the platform;

• Trading volume exceeded $16 billion;

• vePENDLE holders continued to directly benefit from Pendle’s growth, earning $13.1 million in fees.

As a leader in the yield trading space, Pendle continues to solidify its dominance with impressive growth metrics, capturing over 58% of the market share.

In light of this milestone — reviewing the progress of the first half of the year while planning for the second — we had an in-depth conversation with TN Lee to explore the core logic behind Pendle’s success and its future direction.

When discussing the core value that drives user participation and the impressive data behind Pendle’s growth, TN Lee responded without hesitation:

"Yield.I believe the core competitiveness of all protocols comes from strong and sustainable yield. Currently, advanced strategies across different pools can achieve APYs exceeding triple digits. As the world’s largest yield trading platform, one of Pendle’s key functions is to enable users to freely participate in yield trading from the most popular protocols in the market, allowing them to earn smarter.”

Amid the stablecoin boom, many have noticed Pendle’s TVL composition is heavily skewed toward stablecoins, with over 87% of TVL denominated in stablecoins. When asked about his views on stablecoins, TN Lee shared candidly:

“Pendle’s primary focus right now is stablecoins. For DeFi to continue growing, it must integrate with traditional finance. Stablecoins not only drive the maturation of DeFi but also serve as one of the few critical bridges connecting DeFi with traditional finance. Currently, Pendle has launched over 100 stablecoin-related pools. With the acceleration of our community listing mechanism, Pendle aims to bring even more stablecoin pools online.”

In this feature, let’s dive deeper into TN Lee’s insights to better understand the products, market strategies, and sustainable growth behind Pendle. Additionally, we’ll explore Pendle’s next steps in the context of the accelerating convergence between on-chain finance and traditional finance.

DeFi is Maturing, Users Increasingly Demand Yield Trading

TechFlow：We’re thrilled to have the opportunity for an in-depth discussion with you. Could you start by briefly introducing yourself?

TN LEE：

Thank you for the interview opportunity. My name is TN Lee and I’m a co-founder of Pendle. With our team we’ve founded Pendle back in 2021.

TechFlow：

From a 3-year-old child to an 80-year-old senior, how would you describe what Pendle does in one sentence to make it easily understandable for everyone?

TN LEE：

Pendle is the world’s largest yield trading platform. Imagine you own a house: Pendle is like separating the “house ownership” (principal) from the “future rent” (yield). You can choose to keep the house (principal portion), or turn the “future rent” (yield) into a contract to lease to someone else for cash, or conversely, buy someone else’s “rent” to earn yield.

This is how Pendle works—it splits assets into PT (Principal Token) and YT (Yield Token), allowing users to participate in the market’s most popular protocols in a way that suits their investment style and risk management.

TechFlow：In the sector where Pendle operates, there haven’t been many competitors. What do you think is the reason for this? For average users, the yield trading market can have a steep learning curve, yet Pendle has become the leading Yield protocol by TVL (according to DeFi Llama data). From a product design perspective, what do you think Pendle has done right?

TN LEE：

We’ve always had strong confidence in the yield trading sector. In traditional finance, nearly 100% of yields can be traded, but in DeFi, only about 3% are. This sector may have been overlooked by many before, but as DeFi gradually matures, users increasingly need more sophisticated and reliable investment tools, strategies tailored to individual risk profiles, and more flexible, diverse options.

Rome wasn’t built in a day, and Pendle’s success didn’t happen overnight. Bringing yield trading to DeFi requires highly sophisticated and efficient product design to make the concept practically applicable. Before the well-known Pendle V2, Pendle went through a process of trial and error.

Since founding Pendle in 2021, we’ve been tirelessly optimizing our product and securing the resources needed for every aspect of the protocol. The team has always maintained a humble attitude toward the market, coupled with unwavering belief and passion for this sector, striving to seize the best opportunities at the right time. The recent LRTs and points narrative gave us our first chance for explosive growth.

Currently, Pendle is also accelerating its community listing efforts, moving further toward permissionless access, and striving to enable users to participate in yield trading for all top protocols in the market.

At the same time, we anticipate more protocols to join in building the yield trading ecosystem, working together to increase the proportion of yield trading in DeFi to 10%, 20%, 50%, or even higher.

TechFlow：On social media, DeFi OGs often praise Pendle, and many say that those who master Pendle are typically financial elites. What’s your take on this view? Why do you think people have this impression?

TN LEE：

Users with experience in traditional finance may grasp Pendle’s concept more quickly, as yield trading is very common in traditional markets. DeFi’s growth requires time, especially for a relatively new and unique trading model.

However, as the saying goes, “Good wine needs no bush.” We’ve put significant effort into community building and education.

At every stage of Pendle’s growth, we’ve observed more new users willing to take the time to learn and think, investing in a more rational way. Meanwhile, we’ll continue to optimize our product, develop new features, and diligently nurture our community through user education, enabling more people to enjoy the benefits of yield trading.

Yield is the Core Competitiveness: Pendle Enables Triple-Digit APY

TechFlow：Based on what Pendle is doing, what is the core value that attracts users to participate?

TN LEE：

Yield. I believe the strongest competitive edge for any protocol lies in robust and sustainable yields. Through the yield trading model, Pendle users can not only freely choose investment approaches that align with their knowledge and risk management preferences but also leverage various strategies to optimize their ultimate returns.

TechFlow：For someone who’s been exploring DeFi for less than a month, what would you suggest as the first step to start with Pendle? After completing the “beginner village” exploration, could you share what the highest yield in the Pendle ecosystem is currently, and how one can achieve it?

TN LEE：

For beginners, thoroughly studying Pendle’s educational materials is a crucial first step before investing. As you gradually become familiar with the various operational processes, you can develop a strategy that best suits your risk tolerance and capital size.

In addition to the official educational resources provided by Pendle, there are many knowledgeable KOLs on Twitter who frequently share their insights: from the simplest fixed returns offered by PT, to providing liquidity to different pools, to betting on YT, to more advanced strategies like PT leverage looping.

The highest yields in the Pendle ecosystem have grown from double-digit returns initially to now, with advanced strategies in different pools achieving APYs exceeding three digits if not more.

For users at different stages, the most important thing is, of course, finding the strategy that best matches their individual investment preferences.

Focusing on Stablecoins, Boros Combines the Best of CeFi and DeFi

TechFlow：Stablecoins have been a hot topic this year, such as the recent USD1. Pendle has also been collaborating more frequently on stablecoin-related initiatives. What strategic considerations are driving this, and what are your plans?

TN LEE：

Following Ethena’s success, stablecoins have become one of the most popular and increasingly mature sectors in recent years. Pendle has already launched over 100 stablecoin pools.

In the current volatile market environment, we believe the stablecoin sector will be one of the most significant narratives in this market cycle. This highly contested sector not only drives DeFi toward greater maturity but also serves as one of the few critical bridges to traditional finance.

As the world’s largest yield trading platform, one of Pendle’s key functions is enabling users to freely participate in yield trading for the market’s most popular protocols, allowing them to earn money in smarter ways.

With our accelerated community listing mechanism, we aim to launch an increasing number of stablecoin pools more efficiently.

TechFlow：We know Pendle’s explosive growth was closely tied to the Restaking boom. In this new cycle, what do you think will be the next opportunity to drive Pendle’s explosive growth? In the current market environment, with more people and teams focusing on on-chain activities, what preparations should a crypto finance project like Pendle make to seize the opportunity of institutional adoption? What new industry dynamics do you foresee under this trend?

TN LEE：

Our current primary focus is the stablecoin sector.

The market is inherently unpredictable, but our team is constantly monitoring the trends of every narrative. Regarding institutional engagement, a key part of Pendle’s 2025 roadmap is the strategic rollout of the Citadels initiative.

This includes not only the development of Pendle PT as the most robust fixed-yield product—currently, Pendle PT has reached an all-time high of $2.5 billion across various lending ecosystems—but also the active development of additional institutional-grade products to enable different types of institutional investors to participate. For DeFi to continue growing, integration with traditional finance is essential.

Institutional participation also demands higher standards for DeFi protocols and products, from liquidity depth to security and compliance. These are the critical next steps that every protocol must prepare for.

TechFlow：We’ve heard that Boros is currently in a closed beta. What kind of product is it?

TN LEE：

In simple terms, Boros, like Pendle, is a yield trading product.

Boros’ biggest innovation is combining the strengths of CeFi and DeFi, unlocking and utilizing funding rates as a yield source to provide users with a trading platform.

The volatility and reliability of funding rates also make them one of the largest sources of yield. Boros will also be a more straightforward and user-friendly product—if you believe funding rates will rise, you can go long; if you think they’ll fall, you can go short.

We are currently finalizing smart contract audits and internal testing, aiming to open it up to more users soon.

Behind the Growth: Strong Belief in DeFi, Hunger for Innovation, and Adaptability

TechFlow：From the perspective of macroeconomic factors like tariffs and interest rate cuts, are you concerned or optimistic about DeFi’s future development? What keeps you committed to building in this industry? With market attention shifting to AI and memes, do you feel anxious as a DeFi product?

TN LEE：

I’ve always had strong faith in DeFi.

During these turbulent market and political times, we are, of course, more cautious, but my team and I firmly believe that yield trading is a critical sector for DeFi’s future development, and we have high expectations for its growth trajectory.

DeFi has always seen narratives come and go—shiny things come and go. I believe that as long as our product-market fit is right, and we maintain a relentless drive for progress, caution, and respect for the market, Pendle will continue to grow steadily. Anxiety won’t change market trends. All we can do is stay grounded, adapt our mindset flexibly, and proactively tackle every challenge that lies ahead.

TechFlow：Some early Pendle supporters have said that your journey to where you are today has been incredibly challenging. You’ve faced many difficulties but persisted, leading to today’s remarkable success. Could you share the challenges Pendle faced during its development and your reflections at different stages?

TN LEE：

Indeed, from the initial creation of Pendle in 2021 to today, we have faced numerous challenges. We also understand that at different stages of a protocol's growth, there are always unique challenges to consider and address: from the survival game of a new protocol to how a mature protocol maintains excellence. We cannot afford to let our guard down for a moment.

During Pendle’s toughest times, I sometimes wondered how we managed to persevere, especially in those periods when market conditions were exceptionally harsh. Nowadays, the cost of developing a protocol is increasingly low, and almost anyone can start a company to build one. However, navigating the ups and downs of a protocol’s growth and facing various challenges may not be something everyone can endure and survive.

Sometimes, it’s not about how difficult the challenges are, but about how we can adjust our mindset in the face of adversity to confront challenges head-on and solve problems.

Pendle has consistently maintained a lean team model, being extremely prudent with company expenses to ensure we have sufficient runway to support our future growth.

TechFlow：As a DeFi OG and an entrepreneur who’s been building in the industry, what do you think are the most important qualities for starting a business in the crypto space?

TN LEE：

Perseverance.

When Pendle first launched in 2021, we didn’t immediately find PMF. It took us over 2 years before Pendle V2 found meaningful momentum during the early days of LST. But more so than a personal quality, what truly matters is embedding it into the DNA of your team - staying hungry together, maintaining a culture of excellence, and moving as one unit towards a shared mission. That’s how momentum is built, and sustained.

Another trait that’s particularly important for crypto is Adaptability. The space moves fast, with its own rules, rhythms, and culture. Being able to pivot quickly, whether it’s refining your product to match the narrative of the moment, or tuning your marketing strategy for a crypto-native audience, are all the small things that can make all the difference.