Pendle adjusts PT Looping fees to reduce costs for users

Pendle just reworked how it charges for one of its most popular features. PT Looping, the protocol’s automated leverage tool for Principal Tokens, now uses a dynamic fee model that scales based on how much yield a user actually stands to earn. The cap sits at 10 basis points, and for shorter or lower-yield loops, fees drop well below that ceiling. What changed and why it matters The new fee formula targets roughly 10% of the projected yield from any given loop, with an absolute maximum of 10 basis points (0.10%). That replaces the previous model, which charged a flat 5 basis points on total notional assets, plus whatever trading fees and gas costs piled on top. Under the dynamic model, lower-yield loops get proportionally cheaper fees. Meanwhile, someone running a short-duration loop on a modest yield might pay just a few basis points. For context, a basis point is one-hundredth of a percentage point. Ten basis points on a $100K position is $100. How PT Looping actually works PT Looping is Pendle’s way of automating a strategy that DeFi power users have been doing manually for years. The basic idea: you hold Principal Tokens, borrow against them as collateral on a lending platform ...