As several users report in the forum there are sometimes cases where AI deletes the whole project folder by going around the deletion prevention settings.
As new AI models Claude 4, O3 series and o4 series are known for more proactively to circumvent guardrails, an internal solution will be needed.
I propose a solution which creates regular checkpoints of code in an internal storage (App level, not within project folder) that can be restored from timestamps.
It could be activated by user when creating/opening a new project and wiped when deleting a project.
This is regardless if user uses Git, History/SpecStory Extension or other methods as those folders are also deleted when AI deletes the main project folder.
In case users need control which files to not backup, due to size or frequent changes (logs), a .cursorbackup file could exclude folders or file types with sensible defaults included by Cursor.