# Pendle AMM Notional trading volume Methodology

## 1. Overview

Notional trading volume is defined as the total value of assets traded through the Pendle AMM. This metric is utilized to assess the liquidity, trading activity, and utility of Pendle's yield-trading markets, which is directly correlated with the protocol's ability to generate swap fees. The overall market demand for Pendle's yield derivative products is quantified by aggregating the volume of standardized yield (SY), principal tokens (PT), and yield tokens (YT) exchanged.

## 2. Data sources

- **Blockchain events**: `Swap` events from `MarketV2`, `MarketV3`, `MarketV4`, `MarketV5`, `MarketV6`, and `MarketV7` contracts, and daily exchange rate state reads for standardized yield (SY) assets, covering Ethereum, Arbitrum, Base, BNB Chain, and 8 other chains
- **External data**: End-of-day price feeds for underlying assets and asset metadata

## 3. Step-by-step calculation

### Component A: Swap volume extraction

- **Purpose**: Raw swap volumes are extracted from Pendle AMM market contracts.
- **Logic**: `Swap` events are parsed from `MarketV2`, `MarketV3`, `MarketV4`, `MarketV5`, `MarketV6`, and `MarketV7` contracts. The raw volume is extracted from the `netSyOut` field, which represents the net amount of standardized yield (SY) assets output from the swap. For specific Bitcoin-related standardized yield assets (such as cbBTC) on Berachain, Base, and Monad, the raw volume is divided by a fixed scaling factor to align with the standard decimal representation of the underlying assets.
- **Key fields**: `netSyOut` (raw volume amount), `address` (market contract address), `transaction_hash`, `block_timestamp`

### Component B: Standardized yield exchange rate application

- **Purpose**: Standardized yield asset volume is converted into underlying asset volume.
- **Logic**: Market addresses are mapped to their corresponding principal token (PT) and standardized yield (SY) assets using market creation factory records. Daily exchange rates for each SY asset are retrieved from historical state reads, with missing rates filled forward from the last known valid rate. The adjusted raw swap volume is multiplied by the daily SY exchange rate to calculate the volume in terms of the underlying asset. For the hBTC standardized yield asset on Base, an additional scale correction is applied to account for the decimal mismatch between the SY shares and the priced underlying proxy.
- **Key fields**: `rate` (SY exchange rate), `sy_address` (standardized yield asset address), `underlying_address` (underlying asset address)

### Component C: Decimal normalization and USD conversion

- **Purpose**: Underlying asset volume is normalized by its decimal precision and converted to USD.
- **Logic**: The underlying asset volume is normalized by dividing the calculated amount by the asset's decimal precision. The normalized volume is then multiplied by the end-of-day USD price of the underlying asset, sourced from end-of-day price feeds. The final values are aggregated daily using UTC day boundaries.
- **Key fields**: `underlying_decimals` (decimal precision of the underlying asset), `price_usd` (end-of-day asset price)

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

Total USD value of derivative contracts executed on the protocol.

Notional trading volume

Exchanges (DEX)

Users deposit yield-bearing tokens into Pendle Markets. The yield-bearing token is wrapped and split up into its principal and yield-bearing components, which allows users to execute yield-trading strategies (i.e. earn fixed yield, long yield). Traders pay a swap fee whenever yield-bearing tokens are swapped with its wrapped, principal, or yield-bearing component tokens.

Pendle is a permissionless yield-trading protocol built on Ethereum, HyperEVM, Arbitrum, BNB Chain, Optimism, Base, Berachain, Sonic, Plasma, Monad, X Layer, and Robinhood Chain. Pendle was founded by TN Lee and was launched in 2021.

PENDLE tokenholders own and govern the protocol. They currently take a cut of the total trading fees paid by traders (revenue).

Pendle AMM

Notional trading volume

Notional trading volume

Chain breakdown