The decentralized yield protocol Pendle encountered suspicious activity. On-chain data showed that an unknown wallet was minting Principal (PT) and Yield (YT) tokens and then dumping them on the market. At first glance, the situation resembled a hack, but the project team stated that the protocol was not breached and user funds remain safe.
What happened
According to Pendle, one of the wallets was completely drained, after which the attacker began minting PT and YT tokens and exchanging them for ETH. This led to rumors of a possible critical hack. However, protocol representatives emphasize that the system was not compromised, and the activity may be related to a local vulnerability or even a false flag.
Nevertheless, the market reacted instantly. The price of PENDLE fell to $4.13, according to CertiK, but quickly recovered after the official statement that the project’s infrastructure was intact. According to The Block, the token dropped 5.4% in a day and is trading around $4.41.
An important moment for the ecosystem
The incident coincided with Pendle’s preparations to launch a stablecoin on the Plasma network, which is expected to significantly increase TVL. Currently, the protocol has about $6.5 billion locked, according to DeFi Llama. Experts believe that successful Plasma integration could attract new users, despite short-term market shocks.
What is known about Pendle
Launched in 2021 on Ethereum, the protocol allows users to tokenize and trade future yield from interest-bearing assets — for example, staked coins or deposits in lending protocols. The PT/YT model enables trading the “principal” of an asset and its future yield separately, opening up unique yield strategies.
Community reaction and risks
Although Pendle representatives assure that “there was no hack,” the fact that the attacker was able to mint PT and YT without apparent restrictions raises questions. It is currently unknown how exactly the exploiter gained this ability.
The situation remains dynamic. If it turns out to be a bug in the smart contracts or an unaccounted-for vulnerability, it could affect trust in the protocol. However, the team’s quick response and the absence of direct user losses so far support the system’s stability.
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