Yieldcoin “looping,” or leveraging, is a process where a DeFi user repeatedly supplies a yieldcoin (e.g., sUSDe) to a lending protocol and borrows stablecoins against it. The borrowed stablecoins are then used to acquire more yieldcoin as collateral, effectively increasing its exposure with leverage. This strategy could be profitable if the yield generated by the leveraged collateral exceeds the interest rate (borrowing cost) of the stablecoin loan, i.e., a form of carry trade. Looping strategies may involve significant risks, however, including the potential for loss of funds.