Pendle is a decentralized finance (DeFi) protocol that allows users to trade future yield streams. It is built on the Ethereum blockchain and uses smart contracts to enable users to create and trade yield tokens. These tokens represent future yield streams from various DeFi protocols, such as Aave, Compound, and Curve. Pendle aims to provide a more efficient way for DeFi users to manage their yield streams and hedge against market volatility.

The Pendle protocol has two main components: the Yield Tokenization Engine and the Yield Market. The Yield Tokenization Engine allows users to create yield tokens by depositing their assets into the protocol. These yield tokens represent future yield streams and can be traded on the Yield Market. The Yield Market is a decentralized exchange (DEX) where users can buy and sell yield tokens. The price of these tokens is determined by supply and demand, and can fluctuate based on market conditions. Overall, Pendle provides a unique way for DeFi users to manage their yield streams and participate in the growing DeFi ecosystem.