Dolomite, a decentralized lending protocol on Arbitrum, now enables a one-click gmBTC looping strategy to amplify exposure to GMX trading fees. Users deposit the gmBTC token as collateral to borrow WBTC, which they then convert back to gmBTC, increasing their position and fee revenue while maintaining near 1x Bitcoin price exposure. This strategy generates sufficient borrowing demand for WBTC lenders to earn an organic yield of 2.27%, with no token incentives or liquidity mining programs. The protocol passes through 100% of GMX ecosystem rewards directly to users. The main risk lies in potential margin compression or reversal if borrowing costs rise or if GMX trading volumes decline significantly.
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