What is Fixed Yield?
Fixed yield strategies let you lock in a predetermined APY regardless of market conditions. Using protocols like Pendle, you purchase principal tokens (PT) at a discount that mature to full value, guaranteeing returns if held to maturity. Similar to bonds, but with DeFi-native assets and often higher returns.
In traditional finance, fixed income investors use bonds and CDs to lock in predictable returns. Pendle brings this capability to DeFi, enabling you to secure yields of 5-25%+ on assets like stETH, eETH, and other yield-bearing tokens without exposure to rate fluctuations.
How Yield Tokenization Works
Pendle splits yield-bearing assets into two components:
- Principal Token (PT): Represents the underlying principal, redeemable 1:1 at maturity. Trades at a discount to face value. This discount determines your fixed APY.
- Yield Token (YT): Captures all variable yield generated until maturity. Decays to zero value as maturity approaches.
- PT-stETH trading at 0.97 = ~6% annualized fixed yield
- YT-stETH receives all staking rewards during the period
The key insight: PT prices below face value represent locked-in returns. If you buy PT at 0.95 and hold to maturity, you receive 1.00. A guaranteed 5.26% return regardless of how staking rates change.
Available Markets
| Underlying Asset | Typical Fixed APY | Maturity Range |
|---|---|---|
| . . . . . . . . . | . . . . . . . . . - | . . . . . . . . |
| stETH | 4-8% | 1-12 months |
| eETH (Restaking) | 10-25% | 3-6 months |
| sUSDe | 15-35% | 1-6 months |
| GLP | 10-20% | 3-12 months |
Markets vary by chain (Ethereum, Arbitrum, BNB) with different maturities and yields available.
Strategies
Buy PT for Fixed Returns: The simplest approach. Purchase PT at discount, hold to maturity, redeem for full underlying value. Your return is locked at purchase regardless of subsequent rate changes. LP in PT Pools: Provide liquidity between PT and underlying. Earn trading fees with minimal impermanent loss since PT approaches underlying value at maturity. Additional PENDLE incentives often boost returns. Yield Speculation with YT: Buy YT if you believe variable rates will exceed the implied yield. YT provides leveraged exposure to yield. Small rate increases can mean significant returns, but YT decays to zero if rates disappoint. Calendar Spreads: Advanced users can trade between maturities, going long PT on one maturity and short on another to profit from yield curve movements.Deploy into fixed yield through Fensory. Access Pendle markets directly from the Crypto Wealth Super App with real-time yield comparisons.
Getting Started with Fixed Yield
- Choose Your Asset: Select a yield-bearing token you're comfortable holding (stETH, eETH, etc.)
- Compare Maturities: Longer maturities often offer higher fixed APY but less flexibility
- Calculate Your Return: Fixed APY displayed on Pendle shows your guaranteed return if held to maturity
- Execute on Pendle: Swap underlying for PT through Pendle's interface
- Hold to Maturity: Wait for maturity date, then redeem PT for underlying
- Track with Fensory: Monitor your position and upcoming maturities in your Fensory dashboard
Risk Considerations
Opportunity Cost: If variable rates rise significantly, your fixed rate underperforms. You're trading upside potential for certainty. Maturity Lock: Early exit requires selling PT at market prices, which may be below your purchase price if rates have dropped. Plan to hold to maturity. Smart Contract Risk: Pendle adds a smart contract layer on top of underlying protocols. Both Pendle and the underlying asset carry smart contract risks. Underlying Asset Risk: PT entitles you to the underlying asset at maturity. If the underlying depegs or fails, PT reflects that loss. Liquidity Risk: Some PT markets have thin liquidity, especially near maturity. Large positions may face slippage. Fixed yield involves smart contract risks across multiple protocols. Guaranteed returns only apply if held to maturity. Past fixed rates do not guarantee future availability. Always conduct your own research.Frequently Asked Questions
Is yield truly fixed?Yes, if held to maturity. The discount you pay determines your exact return. Early exit requires selling at market prices, which fluctuate.
What happens at maturity?PT becomes redeemable 1:1 for the underlying asset. Simply redeem through Pendle's interface to receive your principal plus fixed yield.
How do I choose maturities?Balance higher yields (longer maturities) against flexibility (shorter maturities). Match maturity to when you'll need the funds.
What if I need to exit early?You can sell PT on Pendle's AMM, but you'll receive market price which may differ from your entry. The closer to maturity, the closer PT trades to face value.
Is this like a bond?Conceptually yes. You're buying a claim on future value at a discount, locking in your return. The mechanics differ (blockchain-native, shorter durations, higher yields).
Lock In Your Returns
Ready to secure predictable DeFi yields? Deploy into fixed yield strategies through the Fensory Crypto Wealth Super App. Compare fixed rates across assets and maturities, track positions, and receive maturity alerts from your unified dashboard.