Tag: DeFi Risk
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DeFi Risks: Smart Contract-Based Risks
The world of Decentralized Finance (DeFi) has revolutionized traditional financial systems by leveraging smart contracts on blockchain technology. However, with innovation comes inherent risks. In this exploration of DeFi risks, we delve into the technical vulnerabilities of smart contracts, highlighting their non-legally binding nature and the potential for irreversible consequences. We examine historical exploits that…
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DeFi Risks : Governance and Regulatory Risks
Decentralized Finance (DeFi) has ushered in a new era of financial innovation, promising greater accessibility and autonomy for users. However, as the DeFi ecosystem grows in complexity and scale, so do the associated risks. In this second part of our series on DeFi Risks, we delve into two critical aspects: Governance and Regulatory Risks. These…
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DeFi Risks: Paradox of DeFi
Decentralized Finance (DeFi) does come with its own set of challenges. Despite the promise of interoperability, DeFi has resulted in a concentration of nearly all projects on the Ethereum blockchain, introducing a new type of concentration risk. In the pursuit of removing human involvement and automating processes, new risks have arisen or existing ones have…