Pendle retires vePENDLE multi-year lockups as sPENDLE staking goes live

Pendle has begun unwinding its long-standing vePENDLE lockup model, rolling out a liquid staking alternative that shortens withdrawal timelines from years to 14 days, the DeFi project announced on Tuesday.

The transition marks a reset for the yield trading platform, which said the change will also redirect protocol revenue toward token buybacks and introduce an algorithmic emissions model expected to reduce overall emissions by roughly 30%.

Pendle framed the overhaul as a response to constraints in the vePENDLE system, which relied on non-transferable, multi-year locks and a weekly vote-to-earn process. Despite generating more than $37 million in protocol revenue in 2025, Pendle said rewards were concentrated among a small subset of users able to navigate what it described as “complex” voting mechanics.

According to Pendle, roughly 20% of the total PENDLE supply was engaged under vePENDLE, the lowest participation rate among comparable veToken models. The platform also cited internal pool-level data showing more than 60% of markets were unprofitable, despite overall fee efficiency exceeding emissions, due to concentrated voting power and manual gauge allocation.

Resetting Pendle’s incentive structure

Pendle said sPENDLE is designed to address these frictions by restoring liquidity and simplifying participation. The liquid staking token is fungible and composable, allowing holders to deploy it across eligible DeFi integrations while remaining active for reward distribution.

Eligibility for rewards is contingent on participating in governance when required. Per the announcement, sPENDLE holders are only deemed inactive if they fail to vote during an active Pendle Protocol Proposal window, with rewards paused for 14 days in that case. sPENDLE deployed in approved DeFi integrations is consistently considered “active.”

The transition also includes a loyalty mechanism for existing vePENDLE holders. Pendle said vePENDLE balances will convert into a boosted form of sPENDLE, with multipliers of up to 4x based on remaining lock duration. The boost is calculated from a snapshot scheduled for Jan. 29 at 00:00 UTC and decays linearly over the remaining lock period, expiring after two years.

sPENDLE staking went live on Jan. 20, while new vePENDLE locks will be paused on Jan. 29, when the protocol’s revised incentive structure formally begins.

Pendle's native token is currently trading at $1.94, according to The Block’s PENDLE price page. This represents a 2.4% gain over the previous 24 hours and places the token’s price approximately 74% below its all-time high of $7.50, set in April 2024. PENDLE currently holds a market capitalization of $327.7 million.