Risks of using our products

Please Note: Before using this product, it’s essential to understand the potential risks involved. Always exercise caution and evaluate your comfort level with these risks.

Risk Categories

1. Smart Contract Risks

• Potential vulnerabilities in the code could be exploited.

• Exploitation of code vulnerabilities may result in partial or total loss of funds, with no recourse for recovery.

• Risks from unaudited or newly deployed contracts.

• Interactions with external contracts that could inherit vulnerabilities.

2. Market Risks

• High volatility of underlying assets affecting position health.

• Liquidation risk due to rapid price declines or fluctuations.

• Collateral devaluation during market downturns.

3. Liquidity Risks

• Insufficient liquidity to withdraw or liquidate assets.

• Over-reliance on illiquid markets for collateral or borrowed assets.

4. Governance Risks

• Changes to protocol parameters that may impact user positions (e.g., interest rate changes).

• Exploitation of governance mechanisms leading to adverse outcomes.

5. Oracle Risks

• Dependency on accurate price feeds; potential manipulation or delays in updates.

• Malfunction or downtime of price oracle services.

6. Operational Risks

• Disruptions in the underlying infrastructure (e.g., node outages, network congestion).

• Risks tied to the user’s operational setup, such as wallet mismanagement or errors in execution.

7. Regulatory Risks

• Legal uncertainty around DeFi activities in various jurisdictions.

• Potential changes in regulatory frameworks impacting the ecosystem.

8. Tax Risks

• Uncertainties or non-compliance with tax regulations across jurisdictions.

• Risks of double taxation, conflicts between jurisdictions, and misclassification.

• Incorrect tax treatment could lead to penalties or financial losses.