Hey fam! 👋 Today we're diving into one of the most efficient leverage strategies in DeFi pioneered by Stephen TCG over at the DeFi Dojo—something that'll make you wonder why you've been doing manual loops like a caveman this whole time. This is Cheat Looping, and it's basically the difference between building IKEA furniture with a screwdriver vs. a power drill. Same result, WAY less pain. 🔧⚡ 🤔 The Problem: Traditional Looping is PAINFUL If you've ever tried to build a leveraged position in DeFi, you know the traditional method is brutal. The Traditional Loop Cycle: 1. Deposit collateral (let's say USDC) 2. Borrow against it (get ETH) 3. Swap the borrowed ETH back to USDC 4. Deposit that USDC as more collateral 5. Borrow more ETH 6. Swap again 7. Repeat... and repeat... and repeat... 😵‍💫 To hit 10x leverage? You're looking at 20+ transactions. The Hidden Costs That Destroy Your Returns Every single loop hits you with: - Swap fees (0.3% to 1% each time) - Slippage (especially painful in thin liquidity) - Price impact (moving the market against yourself) - Gas costs (not huge on L2s but still adds up) - Time (sitting there clicking buttons for 30 minutes) By the time you're done looping to 10x leverage, you might have burned 3-5% of your principal just on fees and slippage. That's months of yield you need to earn back just to break even! 📉 The Liquidity Death Spiral: Sure, there are automated looping tools like Contango or Oiler's multiply feature. But if you're working with anything except the deepest liquidity pairs, these tools can absolutely wreck you with price impact. You think you're getting 10x leverage but you're actually getting 8x leverage and a 15% haircut on entry. Not ideal. 🎯 Enter: The Cheat Loop Cheat Looping is a completely different approach. Instead of looping a small amount multiple times, you use your ENTIRE portfolio capital to open ONE position at maximum leverage, then use the borrowed funds to seed your other positions.

GM DeFi community! ☀️ Buckle up for one of the wildest redemption arcs in crypto history. We're talking about Euler Finance—a protocol that went from getting absolutely rekt to becoming arguably the most sophisticated lending platform in DeFi. This is a story of innovation, catastrophic failure, and an 18-month resurrection that changed everything. 🔥 📚 The Three Acts of Euler Act 1: Euler v1 - The Innovator (2021-2023) Permissionless lending with Uniswap v3 TWAP oracles for long-tail assets. Cool idea, but... Act 2: The $197 Million Nightmare (March 2023) One of the largest DeFi hacks in history. Absolute chaos. 💀 Act 3: The Rebirth - Euler v2 (September 2024) A complete architectural reimagining that makes the protocol basically unhackable. More on this in a minute. 💥 Let's Talk About THAT Hack March 13, 2023: The Day Everything Went Wrong Euler v1 had a fatal flaw. The entire protocol was built like a monolith—one giant shared pool where all assets lived together. Think of it like one massive vault where everyone's assets are mixed together. If ONE thing breaks? The whole system can collapse. Here's How It Went Down: The attacker found a bug in the donateToReserves function. Ironically, this function was added to FIX a previous security issue (the "First Deposit Bug" discovered by whitehat Kankodu). Security fixes creating new vulnerabilities? Classic crypto moment. 😅 The Exploit Mechanics (Simplified): 1. Leverage Loop: Attacker flash-borrowed $30M DAI, deposited it, then recursively borrowed against it to create a 10x leveraged position. Think of it like using credit card A to pay credit card B to pay credit card C... except with millions of dollars. 2. Artificial Insolvency: Called donateToReserves which BURNED their collateral (eDAI) but didn't check if they still had debt. Suddenly their account looked massively underwater—way more debt than collateral. 3. The Self-Liquidation Trick: Used a second address to liquidate their own insolvent position. Because the account looked SO underwater, the liquidation discount mechanism glitched out. The attacker got to claim the protocol's assets at a massive discount.

Hey DeFi fam! 👋 Just finished diving deep into something that's about to change how we think about automation in DeFi. Let me break down this game-changing integration between Brahma ConsoleKit and Euler Finance on Base. 🎯 What's the Big Deal? We're moving away from the old-school EOA (your basic wallet) interactions toward policy-driven, autonomous execution. Think of it like hiring a super-smart assistant that can manage your DeFi positions 24/7, but with ironclad rules that prevent them from ever running away with your funds. 🔐 🏗️ The Double Sub-Account Architecture Here's where it gets spicy. This integration uses TWO layers of sub-accounts working together: Layer 1: Brahma Sub-Accounts (The Custody Layer) 🛡️ - This is your smart contract wallet that's governed by CODE, not just a private key - YOU keep ownership and withdrawal rights - But you delegate execution rights to an automated agent (the "Executor") - The beautiful part? The Executor literally CANNOT move your funds unless the on-chain policy says it's cool Layer 2: Euler Sub-Accounts (The Risk Layer) ⚖️ - Each address can control up to 256 separate sub-accounts - Each one is treated as completely isolated for collateral and liquidation purposes - Want to run a degen leverage play AND a safe blue-chip position? Now they won't contaminate each other The Magic Combo: Your Brahma Sub-Account owns the Euler position. The agent can rebalance your portfolio, but the Brahma policy layer acts as a bouncer—no sketchy moves allowed. 💪 🔧 The Technical Reality (For the Builders) If you're looking to build with this stack, here's what you need to know: The Challenge: The Brahma SDK doesn't have pre-built Euler functions yet. No simple consoleKit.euler.deposit() calls. You've gotta roll your own using the Executable schema. The Executable Schema is your universal translator for any EVM transaction: - callType: Always use 0 (CALL) for external protocols - to: Your target contract (Euler modules or eToken addresses) - value: Usually 0 for ERC-20 stuff - data: The encoded function call (deposit, borrow, etc.)

Look at that silver slide!

Hey everyone, I just wanted to give you a heads up to be extra careful. I just lost 4.6 ETH. I used Aperture finance to open and LP, 1 week later I withdrew my position on Revert finance and the funds hit my wallet and instantaneously were sent to an unauthorized contract address. Turns out there was a hack on Aperture Finance, that I am just now realizing I was affected by - https://phemex.com/news/article/17-million-stolen-in-attacks-on-aperture-finance-and-0xswapnet-56041 I use a Tangem hardware wallet, VPN, and am very cautious, yet this still happened to me. It's enough to make me vomit and want to run from the crypto space. 🤮 Just sharing so hopefully you can avoid something like this.