> For the complete documentation index, see [llms.txt](https://stackfi-2.gitbook.io/stackfi-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://stackfi-2.gitbook.io/stackfi-docs/risks-terms-and-conditions.md).

# Risks, Terms & Conditions

###

Using StackFi involves smart contracts, leverage, and decentralized governance, all of which carry inherent risks. This section outlines the key risks users should understand before interacting with the protocol.

### General Disclaimer

It is important to distinguish between the StackFi interface and the StackFi protocol:

* The StackFi App (interface) is only a frontend for interacting with the protocol
* The StackFi protocol consists of on-chain smart contracts

Interfaces may be upgraded, replaced, or go offline entirely. Even if this happens, user positions remain on-chain and accessible through other interfaces or direct contract interaction.

### Protocol-Level Technical Risks

#### Oracle Risk

StackFi relies on price oracles such as Chainlink and Redstone.

* Incorrect or delayed price data may trigger improper liquidations
* Oracle failures can lead to unexpected losses

#### MEV & Sandwich Attacks

Like most DeFi protocols, StackFi users may be exposed to MEV (Miner / Maximal Extractable Value) risks.

* Transactions may be front-run or sandwiched
* Users should limit slippage and consider using protective RPCs

#### Stablecoin & Peg Risks

Assets used within StackFi may experience:

* De-pegging events
* Freezing or blacklisting by issuers

These events can negatively impact lending pools and collateral values. Diversification of collateral assets is managed through governance.

#### Liquidation Risks

Liquidations are executed by third-party liquidators, not by StackFi itself.

* If liquidations fail or occur late, pools may become under-collateralized
* The Reserve Fund exists to help mitigate extreme scenarios, but cannot eliminate risk entirely

#### Allowed List Risks

StackFi restricts interactions to approved tokens and contracts.

* Misconfigured or exploitable integrations could impact pool solvency
* Internal governance oversight is required to maintain safe configurations

#### Liquidity Provider Withdrawal Limitations

In periods of high utilization:

* Liquidity providers may be unable to withdraw instantly
* This behavior is similar to protocols like Aave and Compound

Interest rate models adjust dynamically to help restore balance.

#### Wallet & Infrastructure Risks

Users may experience:

* Wallet connection failures
* RPC outages or network congestion

These issues may temporarily prevent interaction with the protocol.

#### Smart Contract & Exploit Risks

StackFi relies on complex smart contracts.

* Bugs, exploits, or unexpected behavior could result in partial or total loss of funds
* Audits reduce risk but do not eliminate it

### Interface & Application Risks

#### Beta Software

The StackFi interface is experimental software.

* Features may change
* Performance and safety are not guaranteed

#### Software & Security Risks

The interface may:

* Contain bugs or vulnerabilities
* Be targeted by phishing, malware, or UI exploits

Users should always verify transactions on-chain.

#### Blockchain Dependencies

StackFi depends on underlying blockchains.

* Network outages, re-orgs, or consensus attacks can disrupt protocol operations

#### Protocol Complexity

StackFi is an advanced DeFi protocol.

* Not suitable for beginners without proper research
* Users must understand leverage, liquidation, and collateral mechanics

#### Data Accuracy

Interface data is:

* Automatically generated
* Subject to delays or inaccuracies

On-chain data should always be treated as the source of truth.

#### User Error & UI Risks

Poor interface understanding or mistakes may result in:

* Incorrect transactions
* Unintended leverage or exposure

#### Legal & Regulatory Risks

Changes in regulations across jurisdictions may:

* Limit access
* Affect protocol operations or interfaces

#### Theft & Attack Risks

DeFi remains an adversarial environment.

* Flash loans, exploits, or coordinated attacks may result in total asset loss

### Final Notice

StackFi should only be used by individuals who fully understand the protocol, its mechanics, and its risks.

Users are strongly encouraged to:

* Verify all transactions on-chain
* Secure their wallets and private keys
* Use conservative parameters
* Exercise caution when using leverage

DeFi involves real risk. Always act responsibly.