Protocol Risks
Risk Factors In Decentralized Lending Protocols
As with any DeFi platform, using Curvance comes with inherent risks. Users need to understand these risks and manage them effectively.
1. Liquidation Risk
Borrowing on Curvance 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 Liquidations section.
2. Smart Contract Risk
Curvance operates on open-source smart contracts, which can contain vulnerabilities. Although Curvance 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 introduces 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
Curvance 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.
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