Homestead Opens Alongside Pendle and Morpho
Jan 29, 2026
Homestead is finally live! As of 1/29 00:00 UTC, users who hold cUSD, YT/LP-cUSD and YT/LP-stcUSD along with lenders to Morpho markets have started earning caps while in parallel our delegators have been accruing COGs.
In our previous program, Frontier, those who earned caps were whitelisted early for the ICO and will receive a first of its kind stabledrop. Now with Homestead open, participants old and new alike will be able to reap whatever opportunities await in the next stage of Cap’s growth
In our previous article announcing Homestead, we highlighted our progress and details about the program. The goal for this article is to recap what actions are being rewarded caps and to provide how-to-guides for them.
Review of Products and Incentives
To review, Cap’s two flagship products are:
cUSD = cUSD is Cap’s digital dollar asset. It is redeemable for available collateral assets, such as blue chip stablecoins and regulated money market funds.
stcUSD = stcUSD is the yield-bearing version of cUSD. It earns yield from both the base strategies of cUSD’s collateral assets, as well as yield from Cap’s allocations to institutional yield operators.
Participants in Homestead must choose whether they want yield or caps. While holding stcUSD, PT-cUSD, and PT-stcUSD earns organic yield, the following cUSD will earn caps in the Homestead program:
Holding cUSD: 10x caps per cUSD per day
Holding YT/LP-YT cUSD on Pendle: 20x caps per token per day
Holding YT/LP-YT stcUSD on Pendle: 5x caps per token per day
Lending stablecoins to stcUSD and Cap PTs on lending markets: 0.5x caps per dollar per day
Activity on MegaETH: more information will be released on MegaETH-native incentives as the chain launches. Please follow Cap’s community handle on X for updates.
During the first month, all cUSD activities will earn double caps.
Getting the Most Out of Homestead
The simplest action a user can take to start earning caps is to mint cUSD. To do so, here is a step-by-step guide:
Go to cap.app/swap
Connect your wallet and make sure you have sufficient USDC
Select how much cUSD you want to swap for
Click “swap”
Maximizing Homestead with Pendle and Morpho
Instead of diluting our caps across a wide range of actions on protocols, we made the conscious decision to double down on Pendle as the primary venue for users to maximize caps accrual. From this, those who prefer to amplify fixed yield can utilize Morpho for their goals.
What is Pendle?
Pendle is a protocol that tokenizes yield into a trading layer for users to speculate and hedge on, letting anyone split a yield-bearing asset into two pieces, the PT & the YT, and trade them on their AMM.
PT (Principal Token)
YT (Yield Token)
To put it simply, PTs are for users who are risk averse (since its a fixed yield) while YTs are for users who have a higher risk appetite (because yields are floating). For Cap, there are two types of YTs
YT-cUSD allows users to maximize their caps earning 20x a day per asset (40x for the first month)
YT-stcUSD allows users to speculate on yields as well as earn 5x caps a day per asset (10x for the first month)
If you are interested in learning more about Pendle, the team created an excellent video series that breaks down the basics of yield tokenization, Principal Tokens, Yield Tokens, liquidity provisioning on Pendle, and advanced trading strategies. In addition, our Head of Growth DeFi Dave wrote an explainer using yin and yang as a metaphor.
How to Trade PTs and YTs on Pendle (Step-By-Step)
Enter the cUSD market of your choice in the Pendle App
Swap from any supported token into PT-cUSD/PT-stcUSD or YT-tcUSD/YT-stcUSD:
Once you hold PT-stcUSD or YT-stcUSD you can decide to either swap before or hold until maturity.
Things to Keep in Mind
Maturity matters: At maturity, PT redeems 1:1; YT stops earning new yield.
Slippage, gas, and incentives vary by market. Please check Pendle’s UI before confirming any transactions.
What can you do with PTs?
PT holders can hold their asset to maturity where they can claim it once the program concludes. If they want to amplify their fixed yield, use them as collateral to borrow against on Morpho. Morpho markets for PT-cUSD and PT-stcUSD. Below are links to those markets on Ethereum mainnet. Furthermore, users can access a cross-chain PT-cUSD Morpho market on Unichain
In the future, there will be automatic looping protocols that build on top of Morpho. These could be used to amplify yield but should be used with caution and responsibly.
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