MegaLoop
MegaLoop is Orchid’s native looping engine on MegaETH.
It enables one-click, leveraged exposure to yield-bearing MegaETH assets by recursively supplying collateral and borrowing against it inside Orchid’s lending pools.
MegaLoop is built for real-time execution, predictable risk parameters and capital efficiency. All loops are executed atomically and managed entirely on-chain.
Supported Assets
MegaLoop only supports assets native to MegaETH and Orchid.
Yield Assets
These are assets that earn yield when supplied.
Debt Assets
These are assets borrowed during looping.
A full list of supported assets and their asset type will be published here in full post mainnet.
How MegaLoop Works
When you open a MegaLoop position:
You supply a supported yield asset.
Orchid borrows a supported debt asset against your collateral.
The borrowed asset is internally swapped or routed.
The resulting yield asset is supplied back into the pool.
The loop settles in a single transaction.
This creates a compounding position where both initial and borrowed capital earn yield.
Each loop is isolated per position and tracked independently.
Loop Profiles
MegaLoop supports two loop profiles.
Designed to amplify steady, protocol-native yield.
Typical use cases:
MEGA looped against stable debt
sUSDe looped against USDC
Returns are driven by yield spread, not price speculation.
Loops built around PT tokens issued on MegaETH.
Yield is realized over time as the PT approaches maturity.
Short-term mark-to-market may fluctuate, but terminal yield converges at maturity.
Opening a MegaLoop
To open a loop:
Go to the MegaLoop section in the Orchid app.
Select a supported yield asset.
Select a compatible debt asset.
Adjust leverage using the slider.
Review execution details.
Confirm the transaction.
Higher leverage increases yield exposure and liquidation risk.
Managing a Position
Once open, positions can be modified in real time.
You can:
Add collateral
Reduce exposure
Adjust leverage
Close partially or fully
All changes update your Health Factor instantly.
Risk Considerations
MegaLoop increases capital efficiency but introduces amplified risk.
Liquidation Risk
If your Health Factor falls below the liquidation threshold, your position may be liquidated.
Stable Asset Risk
Stable assets may deviate from their target value, affecting collateral value and Health Factor.
Liquidity Constraints
Large positions may experience slippage during open or close if on-chain liquidity is limited.
Execution Costs
Looping involves multiple internal actions. Higher leverage magnifies execution costs.
Users are responsible for monitoring their positions and managing risk.
Understanding Returns
MegaLoop returns depend on:
Yield rate of the supplied asset
Borrow rate of the debt asset
Selected leverage
Fees and execution costs
Time held
A loop is profitable when compounded yield exceeds borrowing costs and fees.
Early PnL may appear negative due to conservative estimates and execution overhead.
Closing a MegaLoop
Positions can be closed at any time.
If liquidity is sufficient, closing is fully automated.
If liquidity is constrained, manual unwinding may be required.
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