the answer for this is order books and market-determined rates. utilization curves are goofy for many reasons, including…
1) risk pricing is tied only to principal, for ex. you end up with a USDC borrow rate being the same between SOL and USDT collateral. in this case, safer collateral subsidizes riskier collateral
2) zero predictability with utilization-based rates means it's impossible to build the fixed-rate structured products that underpin the biggest tradfi markets
3) idle liquidity means a structural rate mismatch where lenders always earn less than borrowers pay
anyways. defi borrow/lend deserves a market where risk can be priced on every parameter of a loan (LTV, collateral, principal, etc.)
Extremely rare to have a good experience looping with size on any platform but Aave
Feel like the curators / lenders will target borrowers by consistently keeping things above the kink
Most recently after we 7x looped on Morpho on Hyperliquid they literally just changed the underlying curve
Also getting out ends up having tons of fees and long waits (instant deposit but multi-day exit, need to swap to a different asset on withdrawal so face slippage and swap fees, etc.)
This is why I'm bullish on fixed-rate lending and PT/YT-like solutions where everything is locked in at the time of making the position
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