Curvance
  • Protocol Overview
    • Click Less, Earn More
    • Protocol Architecture
    • Asset Types
    • Liquidity Markets
      • Borrowing
      • Liquidations
      • Interest Rates
      • Oracles
      • Collateral Caps
      • Bad Debt Socialization
    • Application Specific Sequencing
    • New Age Liquidity Mining
      • Protocols
    • How Are New Assets Integrated
    • Plugin System
    • Universal Account Balance
    • Token Approval Management
    • Lending Risks
  • Security
    • Security and Audits
  • Miscellaneous
    • RPCs and Testnet Stability
    • Glossary
    • TL;DR
      • Customer Types and Benefits
    • Brand Assets
    • Weblinks
    • Disclaimer
    • Frequently Asked Questions
  • Developer Docs
    • Overview
    • Quick Start Guides
      • Atlas Fastlane Auctions (coming soon)
      • Plugin Integration
        • List of Delegable Actions
      • Supply & Collateral
        • Lend Assets
        • Deposit into pTokens
      • Borrowing & Repayment
        • Borrow
        • Repaying Debt
      • Leverage
        • Leveraging
        • Deleveraging
    • Lending Protocol
      • Market Manager
      • Position Tokens (pToken)
      • Earn Tokens (eTokens)
      • Dynamic Interest Rate Model
      • Universal Balance
    • Position Management
      • Leverage
      • Deleverage / Fold
    • Dynamic Liquidation Engine (DLE)
      • OEV Liquidation System
      • Bad Debt Socialization
    • Plugin & Delegation System
      • Transfer Lock Mechanism
      • Delegable Actions
    • Cross-Chain Functionality
      • Messaging Hub
      • Fee Manager
      • Reward Manager
    • Auxiliary Functionality
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  1. Protocol Overview

Lending Risks

PreviousToken Approval Management NextSecurity and Audits

Last updated 5 months ago

Risk Factors In Decentralized Lending Protocols

As with any DeFi platform, using the Curvance protocol has inherent risks. Users need to understand these risks and manage them effectively.

1. Liquidation Risk

Borrowing on Curvance's lending markets exposes users to liquidation risk. The more assets borrowed, the higher the risk of liquidation if collateral values drop. Users are responsible for monitoring and managing their borrow positions. For detailed information, see the section.

2. Smart Contract Risk

The protocol is comprised of various open-source smart contracts, which can contain vulnerabilities. Although the protocol undergoes regular audits to minimize this risk, no audit can entirely prevent potential exploits. Additionally, Curvance’s integrations with infrastructure providers and other DeFi protocols introduce added layers of smart contract risk. While auditors vet all protocols in use, users should conduct their own research and assess risks before interacting with any dApp.

3. Oracle Manipulation Risk

The Curvance platform depends on oracles for accurate pricing data. While the dual-oracle system is designed to prevent manipulation, edge cases could occur where both oracles are compromised. Users should be aware of this risk when interacting with the platform.

Liquidations