Key risks
- Liquidation risk. If a position’s LTV reaches the venue’s Liquidation LTV, the protocol liquidates collateral and charges a penalty. Higher multiples amplify this risk. Supersmooth automations reduce liquidation risk but cannot eliminate it.
- Interest rate risk. Borrow rates are variable and can spike with utilization. Accruing interest raises a position’s LTV and liquidation price over time, even in a flat market.
- Oracle risk. Positions are valued by venue oracles. Oracle delays, manipulation, or failure can trigger liquidations at prices that differ from spot.
- Automation execution risk. Supersmooth automations are best-effort. Network congestion, gas spikes, sequencer downtime, gap moves, or slippage limits can delay execution, execute at materially worse prices than the trigger, or, in extreme moves, fail to beat the venue’s liquidation engine. You should never rely on automations as a sole risk management method.
- Depeg risk. Supersmooth Yield Loops and correlated-asset markets carry the risk that the pegged asset deviates from its peg. Depeg is the highest-velocity path to liquidation in otherwise low-risk strategies.
- Exit liquidity risk. Several Supersmooth Earn strategies have queues, cooldowns, or caps. The Supersmooth interface surfaces each strategy’s exit profile, and you should read it before depositing.
- Smart contract risk. Underlying protocols and Supersmooth’s own contracts may contain bugs despite audits.
- Third-party risk. Supersmooth is unaffiliated with the protocols it integrates and with third-party strategy managers such as Steakhouse, Gauntlet, and KPK. Display of a market or vault in Supersmooth, including curation tags and risk tags, is not an endorsement.
- Network risk. Chain congestion, outages, or reorganizations can delay any transaction, including automation executions.