Funding rates can also be traded! Pendle launches Boros to tokenize perpetual futures fees, what are its features?

Pendle Finance recently launched Boros on Arbitrum, tokenizing the funding rate of perpetual futures into “Yield Units” (YUs), allowing the funding rate itself to become a tradable investment target for the first time. (Background: Pendle’s locked value has surpassed $4 billion; how to earn leveraged returns? Complete introduction and staking tutorial) (Additional context: Pendle has launched a new Bitcoin yield product, and Arthur Hayes predicts: PENDLE will surge to $10) The funding rate of perpetual futures has long constituted the transaction cost for investors in centralized exchanges (CEX) in the background. However, the decentralized finance (DeFi) protocol Pendle Finance has officially launched the new platform Boros on Arbitrum, tokenizing the funding rate of perpetual futures into “Yield Units” (YUs), making the funding rate itself a tradable investment target for the first time. What is Boros? How does it operate? Boros converts the funding rate of perpetual futures into tradable Yield Units (YUs), where each YU represents the funding rate yield of 1 unit of the underlying asset (such as 1 ETH or 1 BTC) before a specific expiration date. This design is similar to Pendle V2’s yield tokens (Yield Tokens, YT), but focuses on the funding rate in the perpetual futures market. Currently, Boros supports trading the funding rates of perpetual futures for BTC-USDT and ETH-USDT trading pairs on Binance, with plans to expand to more assets (such as SOL, BNB) and other exchanges in the future. As for its operating mechanism, Boros is based on the automated market maker (AMM) model, allowing users to buy and sell YUs on-chain, achieving the following operations: first, go long on YUs. If investors expect the funding rate to rise, buying YUs can yield returns. Second, go short on YUs. If they expect the funding rate to drop, they can sell YUs for speculation or hedging. Third, hedge risk. Perpetual futures traders can lock in funding rates through YUs, reducing fluctuation risk. The Boros platform initially has conservative parameters, with an open interest (OI) cap of $10 million for each market and a leverage limit of 1.2 times, aiming to ensure early risk control. Boros Vaults: The core role of liquidity provision It is worth noting that Boros Vaults are an important component of the Boros platform, similar to Pendle V2’s liquidity pools, allowing users to deposit funds into specific markets (such as BTC-USDT or ETH-USDT) liquidity pools to support YUs trading. Users participating in Vaults are called liquidity providers (LPs), who can earn the following returns: first, trading fees: a share of the fees from buying and selling YUs. Second, PENDLE incentives: proportionally distributed PENDLE token rewards based on liquidity contributions. Third, changes in implied annual percentage rate (APR): if the market funding rate undergoes favorable changes, the value of the Vault position may also increase. In summary, Boros Vaults provide the necessary liquidity for the platform, ensuring smooth execution of YUs trading while creating passive income opportunities for LPs. However, it is important to note that providing liquidity may also face impermanent loss (IL) risk, and investors need to assess this carefully. But Pendle stated that in the coming weeks, it will launch an open recommendation program and rebate mechanism to further incentivize Vaults participants. Is Pendle welcoming new growth momentum? The launch of Boros marks another significant innovation for Pendle in the DeFi space. Analysts predict that in the future, Pendle may launch more yield products through Boros, including bonds, stocks, and real-world assets (RWA). According to Coingecko data, at the time of writing, the Pendle token $PENDLE is reported at $4.3, having risen 11% in the last 24 hours, with a market capitalization of approximately $715 million. Related Reports 11,000 ETH stolen! A comprehensive overview of the Pendle derivative protocol Penpie hacking incident EigenLayer airdrop is here! $EIGEN’s OTC price soared beyond $12; instructions for claiming organized. Why did Pendle rebound sharply to a new high of $6.5? Transaction fee income “increased 8 times monthly”; experts agree: coin price is highly related to protocol income. <“Funding rate can also be traded! Pendle launches Boros to tokenize the funding rate of perpetual contracts; what are the features?”> This article was originally published in BlockTempo “Block Trend - The Most Influential Blockchain News Media.”