Decentralized Finance yield platform Pendle is ready to interchange its vePENDLE token as its major governance and reward token, arguing the earlier design held again broader adoption.
In an announcement by way of X on Monday, Pendle unveiled sPENDLE, its new “liquid staking token” that can quickly change vePENDLE as the first governance token on the protocol.
“We’re excited to introduce sPENDLE, the subsequent evolution of Pendle tokenomics. This improve is designed to deal with essential limitations of the vePENDLE system, whereas unlocking new alternatives for PENDLE holders and the protocol,” Pendle stated.
sPENDLE is a liquid price and governance token with a 14-day withdrawal interval, the workforce added.
sPENDLE staking will go stay on Tuesday, whereas vePENDLE locks shall be paused on Jan. 29. A snapshot will then be taken of consumer vePENDLE balances to assist with the switchover.
On the identical day, the brand new governance construction underneath sPENDLE will totally roll out.
In keeping with information from DeFi Llama, Pendle is the Thirteenth-largest decentralized finance (DeFi) platform when it comes to complete worth locked at virtually $3.5 billion.
Higher tokenomics a doable boon for Pendle customers
Within the submit, Pendle stated that regardless of sturdy platform development over the previous couple of years, vePENDLE in the end prompted “vital boundaries” that restricted “broader adoption.”
One key issue was the lengthy lock-up instances for the asset, through which customers couldn’t get their funds again till the set time intervals had been over.
Pendle stated it was designed to drive long-term dedication to the protocol, however failed to attain its objective. To handle this, sPENDLE could be locked up and withdrawn at any time following a 14-day unwinding interval, or immediately for a 5% price.
Different issues included the dearth of interoperability of vePENDLE, because it was non-transferable, that means that it couldn’t be utilized throughout different DeFi platforms.
To handle this, sPENDLE shall be built-in with a variety of DeFi platforms, enabling the asset for use for functions reminiscent of restaking.
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Pendle additionally stated the governance construction was too sophisticated for almost all of customers, because it required lively weekly engagement to earn rewards from governance contributions.
“The weekly vote-to-earn system required a deep understanding of DeFi and market dynamics to optimize rewards,” Pendle stated.
“Regardless of producing over $37M in 2025, the advanced voting mechanics meant that rewards concentrated amongst vePENDLE holders with sufficient experience to navigate the system successfully — a tiny fraction of customers,” Pendle added.
To resolve this, Pendle is introducing a brand new governance construction that makes it a lot simpler for holders. As a substitute of weekly engagement, holders will solely must vote for “essential” Pendle Protocol Proposals (PPP) to stay eligible for governance rewards.
When there isn’t a PPP to vote on, they’ll routinely stay eligible.
Below this construction, Pendle may also conduct PENDLE token buybacks utilizing “as much as 80% of protocol income” to distribute as governance rewards.
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