Boros is the platform where the funding rate of a perpetual futures contract becomes something you can buy, sell, hedge or arbitrage on its own, without holding the perp. Pendle launched it on Arbitrum on 6 August 2025 with Bitcoin and Ether funding markets, and by 2026 it had cleared more than $2.8 billion in volume. The instrument is the Yield Unit, a token that represents the funding earned or paid on one unit of a perp position, and it lets a trader turn the most unpredictable cost in leveraged crypto trading into a fixed one.
What a funding rate is
Every perpetual future keeps its price tied to spot through funding, a periodic payment between longs and shorts. When the perp trades above spot, longs pay shorts; when it trades below, shorts pay longs. On centralized venues the payment settles every eight hours, on Hyperliquid every hour, and the annualized cost can swing from near zero to well above 30 percent during a crowded rally. For anyone carrying a leveraged position for weeks, funding is often the largest single cost, and until Boros there was no clean way to fix it in advance.
Yield Units: the instrument
A Yield Unit, or YU, tracks the funding accrued by one unit of notional in a specific perp market on a specific venue, for example one BTC of exposure on the largest centralized perp venue. Buying or selling YU means taking a position on that funding stream against a fixed rate quoted by the market, in the same way that a Principal Token fixes a yield and a Yield Token floats with it in Pendle's PT and YT markets.
| Position | What you pay | What you receive | Profits when |
|---|---|---|---|
| Long YU | The fixed rate quoted at entry | The floating funding the market actually pays | Realized funding runs above the fixed rate |
| Short YU | The floating funding | The fixed rate quoted at entry | Realized funding runs below the fixed rate |
Because a YU only carries the funding component, its cost is a small fraction of the corresponding perp position, which is what makes the instrument capital efficient. Rate data reaches the contracts through Chainlink oracles, and each market settles on the same schedule as the perp it mirrors, so a Hyperliquid YU settles hourly and a centralized-venue YU every eight hours, according to the Boros documentation.
Three trades Boros makes possible
Fixing the funding on a leveraged position
A trader who is long BTC perps and paying funding can lock the cost in three steps.
- Open a long YU position in the matching BTC market for the same notional as the perp.
- Pay the fixed rate quoted at entry, which is now the known cost of carry for the life of the YU.
- Receive the floating funding from the YU as it settles, which offsets the funding the perp charges.
The perp's variable funding and the YU's floating leg cancel, leaving the fixed rate as the total carry. That is the same logic as hedging a position with futures, applied to the funding leg instead of the price leg.
Speculating on the rate itself
A trader with no perp position can go long YU when funding looks set to rise, for instance ahead of an expected rally that will crowd the long side, or short YU when a crowded market looks likely to unwind. The position is a pure view on sentiment and positioning, expressed with a fraction of the capital a perp would need. It carries the same discipline requirement as any leveraged rates trade: the fixed rate at entry is the break-even, and the position loses money every settlement the realized funding lands on the wrong side of it.
Arbitraging funding across venues
Funding for the same asset differs between exchanges, sometimes by several percentage points annualized. Boros lists the same asset's funding from more than one venue, so a trader can go long the YU on the venue where funding is high and short it where funding is low, collecting the spread as a fixed income. Pendle's own analysis of the trade found average fixed returns of roughly 6 to 11 percent annualized across BTC and ETH markets between Hyperliquid and the largest centralized venue, with peaks above 23 percent when positioning was lopsided. Spreads compress as more capital chases them, so the numbers are a snapshot rather than a promise.
Scale and settlement
| Boros fact | Detail |
|---|---|
| Launch | 6 August 2025 on Arbitrum, with BTC and ETH funding markets |
| Launch limits | Leverage capped at 1.2x and open interest capped at $10 million per market |
| Venues covered | The largest centralized perp venue at launch; Hyperliquid markets added later |
| Settlement | Mirrors the underlying perp: hourly for Hyperliquid, every eight hours for the centralized venue |
| Oracles | Chainlink feeds for realized funding |
| Traction by 2026 | More than $2.8 billion in cumulative volume and $6.9 billion in notional open interest, per OAK Research |
The choice of Arbitrum kept settlement cheap enough for hourly markets. The conservative launch limits were deliberate; CoinDesk's coverage of the launch framed Boros as an attempt to bring a derivative that traditional rates desks take for granted, the interest-rate swap, to a funding market that settles hundreds of millions of dollars every day.
Where the risks sit
The first risk is basis: a YU hedges the funding of one specific market on one specific venue, so a perp position held elsewhere is only partly covered, and cross-venue arbitrage positions can diverge before they converge. The second is leverage on a rate that can move violently; funding spikes during liquidations, and a short YU position during a squeeze pays the full spike until the next settlement. The third is the ordinary set of DeFi risks, oracle latency and smart-contract exposure among them, on a platform that has run for just over a year.
For PENDLE holders, Boros matters as a revenue line that scales with perp volume rather than with DeFi yields, which diversifies the fee base described in the PENDLE tokenomics. It is still small next to the core yield markets, and the PENDLE price outlook treats it as an option rather than a driver.
Frequently Asked Questions
Do you need to hold a perp to use Boros?
No. A Yield Unit is a standalone position on a funding rate, so a trader can go long or short funding without holding the underlying perpetual. Holding a perp alongside a YU is the hedging use case; trading YU alone is the speculative or arbitrage use case.
How much leverage does Boros allow?
Boros launched in August 2025 with leverage capped at 1.2x and a $10 million open-interest cap per market, and has kept leverage low by design because funding rates can spike sharply during liquidations. The capital efficiency of a Yield Unit comes from its size rather than its leverage: it costs a fraction of the perp position whose funding it tracks.
Which funding rates can you trade on Boros?
At launch Boros covered Bitcoin and Ether funding from the largest centralized perpetual venue, and it has since added Hyperliquid markets, which settle hourly. Pendle has signalled further assets and venues, so the list grows over time; the current markets are listed on the Boros app.
Funding as an asset class
Boros took a cost that every leveraged trader tolerated and made it a market with a fixed leg, a floating leg and a price. Hedgers use it to know their carry in advance, speculators use it to trade positioning directly, and arbitrageurs use it to harvest the gaps between venues. Each of those flows pays Pendle, which is why the platform matters to the token even while it is a small share of revenue.
Trading the token itself is simpler. LeveX lists PENDLE spot against USDT and PENDLE perpetual futures, where funding applies in the ordinary way, and its Crypto in a Minute library covers the protocols whose rates Boros prices.