Pendle launches Boros: a new paradigm of funding rate trading
Article source: Pendle
Boros will initially support the funding rate of BTC and ETH perpetual contracts on Binance, enabling users to participate in this key yield market through leverage mechanisms for the first time, unlocking new strategies and risk management tools for institutional and DeFi-native traders. Users can place directional bets on funding rates by going long or short on Yield Units (YUs), or effectively hedge their exposure to funding rates.
Boros' launch comes as the Pendle platform's total locked volume (TVL) surpasses $7 billion, reflecting the strong demand for yield strategies in the DeFi space. Boros has expanded into a new market direction based on this, the funding rate market, which has a daily trading volume of $150-200 billion in crypto perpetual contracts, but has not been effectively covered on the chain for a long time.
To ensure smooth initial operation, Boros will launch with a $10 million open position cap and 1.2x leverage, allowing the team to observe market risks and optimize trading mechanisms at an early stage. In the future, more assets (such as SOL and BNB) will be gradually opened, and platforms such as Hyperliquid and Bybit will be integrated, while expanding the product structure for longer periods.
"The perpetual contract market has hundreds of billions of dollars in daily transactions, but there has never been a scalable, permissionless on-chain way to hedge or trade funding rates," said TN Lee, co-founder and CEO of Pendle. Boros changed that. It is a product with real utility, and its architecture also lays the foundation for supporting any form of revenue in the future. ”
One of Boros' immediate use cases is serving delta-neutral protocols such as Ethena (currently TVL of $9.27 billion). Boros can serve as a key hedge against negative funding rates, smoothing out yield fluctuations and improving yield stability during market downturns.
Although Boros focuses on the funding rate market in its initial phase, its underlying architecture is highly scalable and can support any source of income including DeFi protocols, traditional financial instruments, and off-chain assets such as bonds and stocks in the future.
Combined with the launch of Pendle V2, which unlocks and tokenizes DeFi fixed income, Boros becomes the second cornerstone of Pendle's yield economy. Together, they push the boundaries of yield trading and propel Pendle one step further towards a future where "any yield is accessible, tradable, and hedged."
This article is from a contribution and does not represent the views of BlockBeats.