Loss of Capital

      If positions are not liquidated in a timely manner, lenders may lose a portion of their capital.
      The initial maximum loan-to-value ratios have been seen so that loans are 166% collateralized. This should also provide ample time for liquidations.

Borrower Risks


      If the value of your borrowed asset rises above your borrowing capacity - the asset you deposit as collateral may drop in value or the asset you borrow may rise - your position will be liquidated. Refer back to Liquidation Thresholds for more information.
      Borrowers can closely monitor their positions and close them before hitting liquidation levels.
      Though the liquidation threshold and max loan-to-value ratios are the same, the "Safe Max" option provides a cushion for borrowers. The window between when the value of borrowed assets rises above the maximum loan-to-value ratio and remains under the liquidation threshold provides borrowers opportunities to take action.

Smart Contract Risks

      As with any project, there are idiosyncratic risks associated with the project. Though the code has been audited by external security firms, attackers may still find and exploit vulnerabilities.
      To mitigate the risk of attacks, Qubit's code will be audited. Theori will perform an audit in August post-launch.
      Qubit's developers make an active effort to reduce the security risks of dependence on other smart contracts and will only interact with smart contracts that reach the development team's security threshold.
      Chainlink will provide oracles and price feed data for Qubit.
Last modified 13d ago