⚡Leverage Tokens (LTs)
Overview
Leverage Tokens (LTs) transform complex DeFi strategies into simple, tradable ERC-20 tokens. Instead of manually looping, borrowing, swapping, and monitoring positions, users can now access these strategies with just one click — all by holding a single token in their wallet.
Designed to make DeFi more simple, accessible, and composable, Leverage Tokens are modular and permissionless by default. Anyone can create a tokenized strategy, customize how it works, and allow others to trade or hold it just like any ERC-20 asset. LTs are currently live on Ethereum Mainnet and Base
Whether it’s ETH staking loops, yield bearing stablecoin loops, or points farming strategies, Leverage Tokens automate the underlying mechanics, reducing both complexity and risk.
Why Leverage Tokens?
Leverage Tokens have deconstructed leverage to make it simple, automated, and tokenized. Instead of manually juggling borrow/supply loops, gas costs, and risk of execution errors, users can mint a single ERC-20 that represents a full looping strategy. Easy to mint, easy to track, and easy to exit. -- LTs are “Advanced DeFi strategies, simplified.”
Core Value Points
Easy Leverage Exposure
LTs remove the grind and time commitment of manual looping. No more multiple transactions, gas inefficiency, or execution stress. With one click, users get structured leverage and can exit just as easily. LTs make amplified exposure accessible for those who are looking to save time and recoup gas costs.
Maximize Potential, Minimize Friction
LTs deliver the same end-state as manual loops. As a tokenized ERC20 product, LT’s price and performance can be easily tracked and monitored in your wallet or within portfolio tracking tools like DeBank. Best practice is to monitor your position, i.e. watch for positive carry trades (staking yield > borrow cost) much like monitoring an ETF’s price trend.
Transparent and Predictable
Fully onchain and auditable, LTs have nothing to hide in terms of how they operate. Not a multi-sig with opaque processes -- instead, audited smart contract logic that drives consistent outcomes. Users know what to expect and maintain full custody at all times.
Simple, Not Customizable
Unlike competitor solutions that offer custom logic to tailor to each individual, LTs are deliberately standardized to remove any individual onus on logic. They serve users who value quick, low-burden access over micromanagement. Power users who want to “optimize” may prefer DIY or custom tools, but most users will appreciate the frictionless simplicity of LTs.
How It Works
At the core of each Leverage Token is a system of smart contracts that coordinate:
Collateral Management – what asset is being deposited and looped.
Borrowing Logic – where and how funds are borrowed.
Rebalancing Mechanics – how leverage is maintained over time.
This is enabled by the Leverage Managers (Ethereum Mainnet/Base) , foundational contracts that abstracts away the manual work of maintaining a leverage position.
Adapter Types
Each Leverage Token is composed of modular Adapters that plug into different DeFi protocols and strategies.
Collateral Adapters: Define the asset that’s being used as collateral (e.g., ETH, LP tokens, yield-bearing assets, or even RWAs).
Lending Pool Adapters: Specify which lending protocol to borrow from. Currently includes support for Morpho — but others (like Aave or Compound) can be added by token creators.
Rebalance Adapters: Define what leverage mechanics to enforce.
How Rebalancing Works
Leverage Token rebalancing logic is completely modular. When launching a new Leverage Token, the creator must specify the address of the Rebalance Adapter to be used. Seamless contributors have created 3 types of rebalance adapters as a starting point:
These can be used individually, combined or forked by token creators. Token creators are also free to build their own custom rebalance adapters from scratch, provided they adhere to the required interface.
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