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Thetanuts Finance launches Leveraged LRT Strategy Vault to enable further composability with Pendle’s PT-eETH
Singapore, Singapore, March 14, 2024, Chainwire
Thetanuts Finance, the leading decentralized on-chain options protocol, announced that it has integrated Pendle Finance’s $PT-eETH offering to create a Leveraged LRT Strategy Vault on mainnet.
This is the protocol’s first foray into the world of restating and Liquid Restating Tokens (LRTs), a fast-growing primitive within the Decentralized Finance (DeFi) industry that has already attracted more than $10 billion in Total Value Locked (TVL ) has accumulated.
Accelerated staking returns
Restating offers DeFi users the opportunity to use their staked $ETH to secure other networks and earn additional returns beyond what they earn on the Ethereum mainnet. Developed by EigenLayer, it offers users the choice of reallocation directly within EigenLayer’s native dApp or within a Liquid reallocation protocol such as EtherFi. By staking their $stETH in Liquid Restaking protocols, users generate “Liquid Restaking Tokens,” or LRTs, which can also be used to earn additional yield elsewhere.
The current leading LRT is EtherFi, which currently boasts a TVL of more than $2.5 billion. It allows users to deposit $ETH, $stETH, $bETH or $cbETH to mint an LRT called $eETH.
By holding $eETH, users can increase their rewards with EigenLayer points and also protocol points such as EtherFi loyalty points. Additionally, additional opportunities are available through third-party LRTs, such as the innovative Pendle Finance protocol, which aims to increase $eETH yields even further by splitting into $PT-eETH and $YT-eETH.
$PT-eETH is a token that forgoes $eETH earnings and points and instead earns a fixed APR of ~20%. $PT-eETH can be exchanged for $eETH at a 1:1 ratio upon maturity.
As for $YT-eETH, this offers DeFi investors leveraged exposure to $eETH yields and points that are permanently transferred to holders until maturity. From this point on, the token loses its value. Currently, $YT-eETH holders can earn 39x EtherFi points and 20x EigenLayer points.
Bring benefits to $PT-eETH
While Pendle Finance currently stands out for offering the industry’s highest fixed return on $ETH through its $PT-eETH offering, along with complete security of those returns, Thetanuts Finance’s Leveraged LRT Strategy Vault offers users the opportunity to secure those returns to increase even further.
With its new offering, Thetanuts integrates $PT-eETH to launch a Leveraged LRT Strategy Vault on the Ethereum mainnet.
PT-eETH holders can either wait until their tokens mature on June 27 before realizing profits or exit their position earlier if the implied APR is favorable. While the Thetanuts Finance Leveraged LRT Strategy Vault awaits maturity, it offers holders of $PT-eETH the opportunity to earn additional returns by leveraging their $PT-eETH to earn additional returns via options premiums and rewards.
With its Leveraged LRT Strategy Vaults, Thetanuts has created a novel mechanism that requires users to “zap” their $PT eETH tokens and deposit and borrow $ETH on the Thetanuts Finance v3 Lending Market. This $ETH is then deposited into the $ETH Call (“ETH-C”) Basic Vault, where it generates additional Basic Vault option premiums but assumes short volatility risk.
In this way, Thetanuts Finance Leveraged LRT Vaults offer holders of $PT-eETH the opportunity to leverage a valuable asset that they previously could only hold until maturity. In total, they can generate additional income in five ways: EigenLayer Points, EtherFi Loyalty Points, Pendle $PT-eETH Fixed Yield, Thetanuts Finance $ETH-C Basic Vault Option Premiums and $NUTS Rewards after the governance of Thetanuts Finance Token goes live.
Thetanuts Finance is proud to deliver an industry first with its innovative Leveraged LRT Strategy Vaults. The launch represents the first time an options market has created a new return-generating tool for LRT-related staking products. For this reason, it is very likely that there will be strong demand for the new product. There are currently 150,000 $PT-eETH (worth $577 million) in circulation.
Thetanuts Finance will initially launch its Leveraged LRT Strategy Vault on the Ethereum mainnet and eventually integrate other LRT protocols – enabling a similar strategy with other LRTs as collateral.
As with all DeFi investments, $PT eETH short call vaults are not entirely without risk, as depositors effectively assume the short volatility risk. Therefore, there is a risk that their deposits will become worthless if the market for eETH or PT-eETH collapses.
About Thetanuts Finance
Thetanuts Finance is the leading decentralized on-chain options protocol with a focus on altcoin options. With the launch of Thetanuts Finance Leveraged LRT Strategy Vault, Thetanuts Finance will make its foray into the world of staking and liquid restating tokens.
ContactDan Edelstein[email protected]
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