Risks

The protocol is exposed to the following risks, but not limited to:

Smart Contract Risk: There are dependencies on the Protocol’s smart contracts being secure and not have vulnerabilities
Depeg Risks: stablecoin pUSD or Yield-bearing assets spUSD can deviate from their peg due to market fluctuations, low liquidity, or sudden redemption pressures.
External Platform Risks: Bitcoin LSTs and wrappers rely on underlying staking protocols like Babylon or CoreDAO. A bug, exploit, or governance failure in these protocols could compromised the value of the yield-bearing collateral.
Over-collateralized CDP Stablecoin risks: *Liquidation Risks: The stablecoin pUSD is managed based on a liquidation system. If the market value of the collateral falls below the liquidation ratio threshold to the point it is no longer recoverable, full liquidation event is triggered to protect the system. While your collateral position may be liquidated, you retain the pUSD borrowed.

Last updated 1 month ago

The protocol is exposed to the following risks, but not limited to:

Smart Contract Risk: There are dependencies on the Protocol’s smart contracts being secure and not have vulnerabilities
Depeg Risks: stablecoin pUSD or Yield-bearing assets spUSD can deviate from their peg due to market fluctuations, low liquidity, or sudden redemption pressures.
External Platform Risks: Bitcoin LSTs and wrappers rely on underlying staking protocols like Babylon or CoreDAO. A bug, exploit, or governance failure in these protocols could compromised the value of the yield-bearing collateral.
Over-collateralized CDP Stablecoin risks: *Liquidation Risks: The stablecoin pUSD is managed based on a liquidation system. If the market value of the collateral falls below the liquidation ratio threshold to the point it is no longer recoverable, full liquidation event is triggered to protect the system. While your collateral position may be liquidated, you retain the pUSD borrowed.

Last updated 1 month ago