Pendle to Incentivize Full Shift to Limit Orders, Citing 71% Contribution to Trading Volume

May 26: DeFi yield protocol Pendle Finance announced it’s shifting its co-incentive focus entirely to its Limit Order (LO) mechanism, aiming to boost the platform’s liquidity depth and improve trade execution efficiency. Since the full LO incentive system launched roughly two months ago, limit orders now make up 71% of Pendle’s total Swap transaction volume—up from 44% prior to the rollout. Monthly LO trading volume has nearly doubled, cementing limit orders as a core driver of the protocol’s overall trading activity, per Pendle’s latest update. Right now, Pendle allocates approximately 6,500 PENDLE tokens weekly to limit order incentives, which supports around $400 million in notional order book depth. On an annualized basis, every $1 of incentives translates to $800 in liquidity, resulting in an 800x capital efficiency rate, the protocol noted. Pendle also unveiled new co-incentive rules: If a project contributes incentives in PENDLE, every $1 of their input earns an extra $0.22 worth of PENDLE; if incentives are provided in other tokens, each $1 of their contribution yields $0.15 worth of PENDLE. If total demand for incentives exceeds the weekly cap of 9,000 PENDLE tokens, eligible rewards will be distributed proportionally. Pendle emphasized that limit orders have proven to be the most effective tool for lifting market quality and liquidity depth, so all future co-incentive resources will be focused primarily on expanding the limit order ecosystem moving forward.