We have been using TWAP oracle for more than a year on all PT markets we deployed (probably 1-2 exceptions). We are adding a min with a linear discount when it is unsafe to not do it (through Ojo min contract). Linear discount tended to be aggressive creating risk for lenders as it cap the implied PT rate. Having an actual price is the right way to protect lenders (it's still capped at the Pendle AMM side). On PT markets, borrowers can still avoid liquidation and use them like they would with linear discount oracles, just use a LTV that matches the highest YTM on the Pendle AMM. With a TWAP oracle you can get more leverage but no one is saying you should do it. For this particular case, the drop in price was 2.7%. If you have LTV > 85% on PTs I would urge to reconsider. PTs have duration risk.(SebVentures)