According to PetMD, the "loaf" position is a comfortable and compact position for cats to conserve heat and energy. This position allows them to curl up into a tight ball and tuck in their legs and tail, keeping their body warm.
Additionally, the position allows them to be alert and ready to move quickly if necessary. That explains a lot, when it comes to our Vernon, who we call Lighting Vern, because of his white stripe on his back, and the fact that he moves so fast at times
Another reason cats may rest in the "loaf" position is to conserve space, especially when they are in a small or confined area. As stated in an article by Catster, cats are naturally territorial animals and may choose to rest in a position that takes up as little space as possible, in order to assert dominance over their territory.
Lastly, an article by the website The Conscious Cat suggests that the "loaf" position may also be a sign of security and contentment for cats. Cats that feel safe and secure in their environment are more likely to rest in this position, as it allows them to fully relax and let down their guard.
In conclusion, cats rest in the "loaf" position for several reasons such as conserving heat and energy, conserving space and feeling secure and content.
It's always fascinating to watch our feline friends and learn more about their behavior, and the "loaf" position is just one of the many quirks that make cats so fascinating to observe and love.