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Does The Loop read my .env files or secrets?
It must not. The loop's skills are written not to read or print .env contents, and any output that includes a secret is treated as a bug to stop and report.
Tests may need .env to be present on disk to run, and that is fine. The file being there for the test runner is different from the agent reading and repeating its contents.
The loop opens pull requests with the gh login already on your machine, so anyone with access to that machine's Claude session has the same GitHub access.