This recurrence relation can be solved with standard techniques. The result is
$$y_n = \sqrt{\frac{(n+1)(n+2)}{2}}y_0,$$
which clearly diverges for any $y_0\ne 0$.
The connection to differential equations is the following:
Rewrite the recurrence as
$$y_{n+1}-y_n = \left(\sqrt{\frac{n+3}{n+1}}-1\right)y_n.$$
This corresponds to the differential equation
$$y'(x) = \left(\sqrt{\frac{x+3}{x+1}}-1\right)y(x).$$
This can also be solved explicitly.
The result is somewhat complicated but for large $x$ we find
$y(x)\simeq c y_0 x,$
where $c$ is a (calculable) nonzero real number.
This can be easily motivated.
For large $x$ we have
$$y'(x) \simeq \frac{1}{x}y(x),$$
and so $y(x)\simeq \mathrm{(const)}y_0 x$.
More about the connection between recurrence relations and differential equations can be found here.