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Leverage

What Is Leverage?

Leverage allows you to amplify your exposure to an asset by borrowing against it — meaning you can increase your potential gains (and losses) without needing more upfront capital.

In the context of Curve loans, leverage works by borrowing crvUSD against your collateral, then using that crvUSD to buy more of the collateral asset and repeating the process. This creates a looped position with higher exposure to the asset than you originally deposited.

Leverage Example

Let’s look at a basic example using WETH as collateral.

If you deposit 1 WETH and borrow 1000 crvUSD, you can use that crvUSD to buy more WETH. If you do this multiple times, you end up with more WETH exposure — this is leverage.

Here’s what that looks like with different levels of leverage:

ETH Starting Price ETH Ending Price Deposited ETH Borrowed ETH Total ETH Exposure Leverage Profit ETH Profit
1000 crvUSD 2000 crvUSD 1 ETH 0 ETH 1 ETH 1x 1000 crvUSD 0 ETH
1000 crvUSD 2000 crvUSD 1 ETH 1 ETH 2 ETH 2x 2000 crvUSD 1 ETH
1000 crvUSD 2000 crvUSD 1 ETH 2 ETH 3 ETH 3x 3000 crvUSD 2 ETH

Important

Leverage multiplies both profits and losses. If the price goes down instead of up, losses are amplified by the same factor.

Built-In vs. Manual Leverage

There are generally two ways to create (and repay) leveraged loans on Curve: by using the one-click leverage option on the Curve UI, or by manually looping the position.

Built-in Leverage

Differences in Leverage Support

The Curve UI generally supports one-click leverage for loans. This means users can directly “loop” their positions with a single click, without manually repeating the borrowing and buying process.

  • Newer markets support leverage through aggregators, which can route through external liquidity sources for more efficient execution.
  • Older markets (especially the early-deployed mint markets) rely solely on Curve’s internal liquidity, which can result in higher price impact—particularly when leveraging large amounts.

All crvUSD minting markets and some Curve lending markets offer this built-in leverage functionality, allowing users to achieve their desired leverage in a single transaction. Below is an image of the lending UI showing the WBTC lending market. This market allows built-in leverage of up to 11x.

UI Leverage

How built-in leverage works:

UI Leverage

Depositing Combined Assets (Curve Lending Only)

Users can deposit both crvUSD and collateral assets (e.g., WETH) together. In this case, during the single transaction:

  1. WETH collateral is used to borrow crvUSD
  2. Borrowed crvUSD is added to the deposited crvUSD
  3. The total amount is converted to WETH through 1inch
  4. All assets are deposited into the lending market

Leverage with a combination of assets

Note: With combined deposits, the leverage calculation remains the same. For example, with 1,500 crvUSD + 0.5 WETH (total value 3,000 crvUSD) at 5x leverage, the borrowed amount is still 12,000 crvUSD (4x deposited collateral). Repayment process and profit calculation remain unchanged from single-asset deposits, and after repayment the user will receive profit in their borrowed asset.

Manual Leverage Looping

Users can create leverage in any crvUSD or lending market through manual looping:

Leverage Looping Leverage Looping

Users, in this process:

  1. Deposit WETH as collateral
  2. Borrow crvUSD
  3. Swap borrowed crvUSD back to WETH
  4. Repeat the process

Each loop provides less additional leverage since loan LTV is always below 100%. If a user uses 1 WETH worth 3,000 crvUSD, and borrows a total of 6,000 crvUSD, this is called 2x leverage.

Guides

Check out a guide on how to open, close or deleverage here