The main functionality of the gcToken Type 1 contract is leveraging. The contract incorporates a logic to mint cDAI and use it to borrow DAI. The new DAI is then used again to mint more cDAI which in turn is used to borrow more DAI. This cycle is repeaded until we reach the point where the difference between the total amount of DAI used to mint cDAI and the total of DAI borrowed is closed to the actual amount of DAI carried by the reserve.

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