Risk Factors

It is important to understand that investing in DeFi is highly risky.

We believe that every DeFi protocol including DeFi Wonderland has a different level of risk and a different level of reward. These risks can be grouped into:

• Technology: Smart contracts, or collections of code that carry out a set of instructions on the blockchain, are essential for DeFi applications to run. But if there is an issue with a developer’s code, then there could potentially be weaknesses within a DeFi protocol. In order to mitigate this risk, DeFi Wonderland team will endeavor to use extensive methodical examination and analysis of the smart contracts code in addition to hiring third-party auditors to review of smart contracts code to pick up bugs, coding errors, and other potential security exploits.

• Crypto Assets: When borrowing on a DeFi application, you typically offer other crypto assets owned as collateral. Due to the volatile nature of cryptocurrencies, their value frequently fluctuates. If there is a downturn, the crypto assets used as collateral may sharply decline in value, and some may see their positions liquidated.

• Product: It’s also important to note that, unlike with a traditional bank, there is no regulation or insurance on your money when you use DeFi. Though DeFi loans are collateralized with other crypto assets, borrowers using DeFi protocols cannot be held accountable otherwise if they are unable to effectively pay back a loan.

We encourage and recommend conducting thorough research and receiving individual professional advice before buying or investing into any cryptocurrency assets or blockchain platforms.