Arthur Hayes Takes a Dive into LDO and PENDLE – Is a DeFi Rally on the Horizon?

BitMEX co-founder Arthur Hayes has made headlines by significantly investing in two decentralized finance (DeFi) tokens, LDO and PENDLE. His investments total more than $2 million, indicating a possible upcoming rally in the DeFi space. This article explores the implications of Hayes’s strategic buys, the current market dynamics, and the potential for a significant movement in these assets.

Key Takeaways

Arthur Hayes Invests Heavily: Hayes has invested approximately $1.03 million in LDO and $973,000 in PENDLE, signaling a focused approach to capital allocation.
Market Reactions: Both LDO and PENDLE are showing signs of potential growth, supported by increased trading volumes and positive price movements.
Technical Indicators: PENDLE has broken its descending channel, suggesting a bullish trend, while LDO is also stabilizing above key support levels.
Strategic Positioning: Current trends suggest that the markets are preparing for continued upward momentum, especially for LDO and PENDLE.

Arthur Hayes Takes a Dive into LDO and PENDLE - Is a DeFi Rally on the Horizon?

PENDLE Derivatives Show Increased Activity

At the time of writing, PENDLE's derivatives metrics indicate a rise in market participation. Trading volume increased by 29% to reach $78.9 million, while Open Interest rose by 7% to $43.09 million. This surge suggests that new leverage is entering the market rather than traders closing their positions.

The asset’s price responded positively to this increase, trending upward rather than remaining stagnant. Notably, the growth in leverage appears manageable, which lowers the risk of liquidations. Consequently, speculative interest is gradually rebuilding, creating an environment that typically supports ongoing market expansion. When Open Interest, price, and volume all rise together, it often marks a transition from market compression to expansion.

Hayes's investment in PENDLE aligns with this shift, indicating that he is strategically positioning himself ahead of potential market movements.

Source: CoinGlass

LDO Traders Show Confidence, But Stay Cautious

Data regarding LDO positioning offers additional confirmation. Long accounts on Binance have risen toward 60%, pushing the long-short ratio to approximately 1.5. This indicates that bulls currently dominate the market. However, short positions are still active.

While overcrowded long positions can often precede market reversals, LDO has not yet reached that saturation point. Its price has been gradually increasing rather than experiencing sharp spikes, reflecting cautious optimism among traders. Although there is a degree of caution in the broader market, the prevailing long bias in LDO could indicate early confidence rather than market exhaustion. When rising long positions coincide with significant accumulation in the spot market, the likelihood of continued upward movement increases.

Source: CoinGlass

PENDLE Displays Signs of Early Reversal

Analyzing the price charts, PENDLE has managed to break above its descending channel by defending the $1.67 demand zone – a level that has halted selling pressure multiple times. Currently, it is trading at around $1.88, reclaiming the midpoint of the channel and shifting its short-term structure to bullish.

This breakout is not an isolated event. Open Interest rose by 5% to $43.09 million, and derivatives volume surged by 29% to $78.9 million, indicating active participation during the breakout. Furthermore, momentum indicators show potential for continuation, with the MACD histogram flipping positive. It’s crucial for PENDLE to maintain trading above $1.95 to keep the reversal intact; a failure to hold this level could result in a pullback toward $1.67, which is now seen as a critical support.

PENDLE price action analysis Source: TradingView

LDO Breaks Out of Descending Wedge

Meanwhile, LDO has moved out of a prolonged descending wedge formation after consistently holding the $0.55–$0.56 support range, which absorbed selling pressure throughout December. As of now, LDO is priced at $0.57, stabilizing above the breakout level.

Momentum indicators show significant improvement, with the MACD histogram turning positive and the Signal lines indicating a bullish crossover. Positioning data supports this shift, with the number of long accounts rising to about 59–60% without excessive congestion.

From a structural viewpoint, the next resistance level sits at $0.67, where a prior breakdown occurred, followed by a higher target near $0.88. A successful breakout above $0.67 would affirm the trend's continuation, while a drop below $0.56 could invalidate the recent breakout and reintroduce downside risks.

LDO price action analysis Source: TradingView

Are LDO and PENDLE Positioned for a DeFi Rally?

Hayes’s significant accumulation, along with the increasing Open Interest in PENDLE, a strengthening long bias in LDO, and the confirmation of technical breakouts, clearly align these indicators. The current positioning appears early rather than overcrowded, suggesting that market risks may lean more toward continuation than potential rejection.

Should PENDLE remain above $1.95 and LDO reclaim $0.67, both could potentially rise towards higher resistance zones. These developments may signify a strategic setup for a DeFi-driven movement, grounded in structure and participation rather than mere speculation.

Conclusion

As the DeFi landscape continues to evolve, observers will be keen to see how these developments unfold for both PENDLE and LDO. With significant investments from key players like Arthur Hayes, the potential for a rally may be on the horizon, marking an exciting period for the decentralized finance sector.