Looputo

Self-sustained Leveraged Looping. Liquidation & Negative Carry Resistant.

[Looputo @looputo_fi]

1/ We're excited to announce our seed round led by Third Kind Venture Capital to build the first automation layer for DeFi leveraged looping and enable the self-sustained looping market.

This funding accelerates our long-term vision of automating the oldest yield strategy in DeFi.

[Looputo @looputo_fi]

5/ In extreme cases like a depeg or exploit, the position is fully unwound to protect users from further losses.

[Looputo @looputo_fi]

1/ Looputo 101: Liquidation Protection for Your Looping

Loopers love using extremely high leverage to amplify carry and chase max yield. In most lending protocols, 10x–15x leverage in a correlated market is commonly adopted.

But a 1% price drop that looks completely normal can already damage your position:
- 7.5x → LTV from 87% to 87.54%
- 10x → LTV from 90% to 90.91%
- 12.5x → LTV from 92% to 92.93%

Without a fast reaction, a yield-maxing loop can quickly turn into a liquidation nightmare.

That’s where Looputo comes in.

[Looputo @looputo_fi]

4/ In a normal price drop, the position is deleveraged first, then re-levered once price recovers — so the original leverage is maintained.

[Looputo @looputo_fi]

Welcome to Looputo.

A self-sustained looping strategy.

Every second from now on is automatic.

[Looputo @looputo_fi]

5/ Join our Discord to be early to Looputo: https://t.co/yrQGvs4MrK

[Looputo @looputo_fi]

1/ We're excited to announce our seed round led by Third Kind Venture Capital to build the first automation layer for DeFi leveraged looping and enable the self-sustained looping market.

This funding accelerates our long-term vision of automating the oldest yield strategy in DeFi.

[Looputo @looputo_fi]

4/ We would like to thank Third Kind Venture Capital, Anthos Capital, and Launchpad Capital for their participation in this round.

[Looputo @looputo_fi]

We published our thesis on automated leveraged looping on Monday.

Within 24 hours, a ~3% price move wiped out $30M+ in PT-reUSD positions on Morpho.

This is the exact risk we wrote about. To chase yield, loopers run very high leverage — often 10x or more — and most don't feel how fragile that is near liquidation.

At 10x you already start at ~90% LTV. A 1% drop in collateral is a 10% hit to your equity and takes LTV to ~91%. A 2% drop takes it to ~92%, a 3% drop to ~93%. Liquidation thresholds sit right in that range, so a move most people wouldn't even notice is enough to push you past the line.

This is what Looputo automates. Our keepers watch your health factor, collateral price, and the rate spread every block. On any dump, crash, or depeg, we unwind ahead of time — and when a position is about to go, we front-run the liquidators to deleverage you first.

Looping shouldn't mean watching a screen all day. Looputo is coming soon — set your leverage once, and everything afterward is automated.

[Looputo @looputo_fi]

https://t.co/j1zlKQemkz

[Looputo @looputo_fi]

4/ Two jobs nobody in DeFi had automated — now both run for you on Looputo, every block.

Set and forget. Risks are handled from there, automatically.

[Looputo @looputo_fi]

Today, users fear looping. Entry is easy enough — it's the management afterwards that's painful and manual.

A loop dies two ways: fast liquidation, or slow bleeding from a negative rate spread.

See how Looputo automates and protects the DeFi leveraged loop 🧵👇

[Looputo @looputo_fi]

3/ Auto-Unwind keeper, for the negative rate-spread.

When the spread flips negative, nothing liquidates you — you just bleed while you stay in. It exits on inversion, re-enters on recovery. The model reads a true shift from noise, not every dip.

[Looputo @looputo_fi]

This incident exposes the real problem with DeFi’s oldest strategy: looping.

Protocols love one-click looping — easy entry for users, 10x TVL growth for them. Looks great on the dashboard.
But that’s only 1%.

The other 99% is continuous risk monitoring: avoiding liquidation in market dumps and negative rate spreads that silently bleed your yield.

@looputo_fi is built for the full automation of looping — automatically protecting your position after entry so you don’t get rekt by falling prices or inverted rates.

[Ethan DeFi @EthanDeFi_]

This really sucks.

A lot of loopers in the PT-reUSD market have been liquidated a few hours ago.

This was possible due to the design of the PT oracle.

A lot of oracles for fixed yield PT tokens are based on the 15-30 min TWAP price of the PT tokens on Pendle.

The issue with that is that if a whale suddenly buys a lot of YT tokens, then the PT price decreases and loopers can get liquidated if their leveraged PT position is close to the liquidation LTV.

This is exactly what happened with the PT-reUSD market, leading to $30M+ in liquidations, with the PT-reUSD price dipping 2.8% in minutes.

I think @SteakhouseFi made a mistake by using a 15-minute avg. TWAP price oracle for its PT-reUSD market on Morpho and I hope they adjust their oracle designs in the future to avoid such scenarios.

The oracle teoretically worked as intended, but because it was based on the PT-reUSD TWAP price and was easy to manipulate, it led to millions in losses.

The most reliable oracle type for PT markets would be a fully linear discount oracle in my opinion that doesn't take into consideration the PT TWAP price.

A fully linear discount oracle would enable looping with a lower maximum leverage I guess, but it would no longer be affected by the PT price volatility.

[Looputo @looputo_fi]

A 2.8% price drop on @Morpho just liquidated $30M @re PT tokens in positions. This is how fragile DeFi leveraged looping really is — and why it desperately needs automation.
On @looputo_fi, your positions are monitored 24/7 in real time. When a crash hits, Looputo unwind ahead of line so you don’t get liquidated.

[Pendle @pendle_fi]

The Pendle team is aware of the liquidations that took place on the PT-reUSD/USDC market deployed by @SteakhouseFi on @Morpho.

The oracle for this market was set up correctly and functioned as intended. This was not a misconfiguration, despite the unfortunate outcome.

Quick note on how the oracle works

The oracle set up for Pendle PTs varies for every asset and market.

In PT-reUSD’s case, the oracle set up by Steakhouse references the lower of 2 prices:

1. The PT's own market price on Pendle, taken as a 15-minute average
2. A fixed curve that rises to $1 at maturity along a 6% per year discount

At its peak, the PT price dropped by 3% and the 15-minute market average took over as the oracle reference. This lowered the collateral value of looped PT positions borrowing USDC on Morpho. At risk positions with already health factors below 1.03, corresponding to a buffer of less than 3% against price movement, dipped below the liquidation threshold.

The Pendle Ecosystem Vault on Morpho was not affected. Liquidations were processed as intended and no bad debt was incurred.