PENDLE REWRITES LIQUIDITY INCENTIVE RULES

Summary from the TLDR Crypto newsletter

Pendle's Yield Token (YT) subsidy mechanic lets protocols buy liquidity more efficiently. Subsidizing YT boosts demand and raises YT prices, which mechanically pushes Principal Token (PT) prices down (PT + YT = underlying). A cheaper PT implies a higher fixed APY, creating market-leading fixed rates with less incentive spend because subsidies target the smaller YT slice that captures the full yield stream.