Learn

Looping is a DeFi strategy that multiplies your yield by creating a recursive borrow-and-supply cycle. You deposit collateral into a lending protocol, borrow against it, then deposit the borrowed funds as additional collateral. This cycle repeats to achieve leveraged yield exposure.

1. You deposit collateral (e.g., 1 ETH) into a lending protocol. 2. The protocol allows you to borrow against your deposit (e.g., borrow 0.7 ETH worth of USDC). 3. That borrowed USDC is swapped back to ETH. 4. The new ETH is deposited as additional collateral. 5. Steps 2-4 repeat until your target leverage is reached. RecursaAI automates this entire process in a single transaction.

Leverage multiplies both your yield and your risk. A 2x loop means your effective position is twice your initial deposit. Higher leverage means higher potential APY but also a higher chance of liquidation if the market moves against you.

The health factor measures how safe your position is. Above 2.0 is considered safe. Between 1.5 and 2.0 is moderate risk. Below 1.5 means your position is approaching liquidation. RecursaAI monitors your health factor 24/7 and can automatically rebalance to keep you safe.