Risks, in plain words.

YieldShield moves the downside to paid providers. It does not remove it.

Not traditional insurance

  • No guaranteed return or principal.
  • Not financial advice or an offer.

Testnet only

  • Test tokens have no value. Test dollars are not USDC.
  • Apps can be reset or retired.

Smart contracts

  • Unaudited. A bug can cause losses the backing does not cover.
  • Vault tokens carry their issuer's risk.

Prices

  • Oracle or synthetic prices can be stale or wrong.
  • Freshness checks can pause actions.

Backing

  • Protection stops at the reserved backing.
  • If the backing token fails, so does the claim.

Providers

  • You take the first loss.
  • Funds can stay locked while positions are open.

Holders

  • You pay a share of realized gains.
  • Exits follow each app's rules and deadlines.

More in Protection and each deployment's limits on Testnets.