One of #DeFi’s favorite strategies in the recent low-yield environment has been the $LSTETH/ $WETH leverage loop. But $WETH's latest rally has pushed borrow rates up turning looped performance negative. Now you have: – $LSTETH selling pressure – Withdrawal queue >17 days – Liquidity drying up – Liquidation risk rising It’s very easy to lever up in highly liquid, low rate environments. Levering down in a tight market is another story. Stay safe 🧑‍🚒
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