Crypto working like Russian nesting dolls will continue to F us. Here’s why👇

- yield stacking or leverage loops eg Terra
- cross chain yield farming eg rsETH
- leveraged entities using capital to buy the debt of other leveraged entities, with every single layer dependent on the exact same underlying BTC asset eg Saylor’s strategy
- RWA treasury loop is another problem. Long post 👇
•The Core Doll: An institutional provider purchases physical U.S. Treasury bills and tokenizes them into an on-chain T-Bill token (e.g., earning a baseline ~5% yield).
•The Second Doll: A secondary platform takes that T-Bill token and wraps it into a "yield-bearing synthetic dollar" (like Ethena's sUSDe or similar assets). They mix the T-Bill yield with a short-perpetual funding rate to boost the yield to 15%.
•The Third Doll: Investors deposit this synthetic dollar into a money market protocol (like Spark or Morpho), using it as collateral to borrow ordinary stablecoins (USDC/USDT).
•The Loop: The borrowed stablecoins are used to buy more synthetic dollars, which are deposited back into the platform.
•The Catch: While backed by U.S. Treasuries at the very bottom, the upper layers are exposed to smart contract code exploits, cross-protocol oracle failures, and sudden shifts in crypto funding markets.