Loop is a dedicated lending market for Ethereum carry trades. Users can supply a long tail of Liquid Restaking derivatives (e.g., Pendle LP tokens) as collateral to borrow ETH for increased yield and points exposure.

The interest charged to borrowers is distributed among ETH-lenders or lpETH stakers and dLP-lockers, thus rewarding high protocol-alignment that allows Loop to scale.

- Lenders receive back a receipt token, lpETH, that can be used throughout DeFi or be staked to earn passive yield in ETH.

- Loopers can borrow ETH against yielding LRT derivatives to perform carry trades for ETH-based yields.

- dLP Lockers can lock the protocol’s governance token, LOOP, into a Dynamic Liquidity (dLP) position to earn protocol revenue.