August
  • 👋Introduction
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    • 🚥Risks and Audits
    • 🔗Contract Addresses
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On this page
  • Risks
  • Smart Contract Risks
  • Oracle Risks
  • Bridge Risks
  • Who bears the risk in case the risk engine fails?
  • Audits
  • Zellic Audit - August 2023
  • Zellic Audit - March 2023
  • Sigma Prime Audit - August 2024
  • ChainSecurity Audit - January 2025
  1. Smart Contracts

Risks and Audits

Risks entail economic and security problems, like smart contract, oracle and liquidation risks. Security audits are professional assessments on whether the code are safe and correct.

Risks

Smart Contract Risks

The protocol will be interacting with a number of smart contracts, all of which impose risks. This can be both known and unknown risks that could result in the failure or vulnerability on the smart contracts which could result in assets being locked or lost forever.

Oracle Risks

Liquidations depend on a live, accurate price feed from oracles. Oracle downtime, incorrect prices, or manipulation can cause wrongful liquidations. Fallback systems, safety switches, and emergency notification systems are in place to mitigate this risk.

Bridge Risks

The protocol interacts with various bridges to move assets from blockchain to blockchain. While all bridges have been carefully reviewed for their risks and liquidity constraints, risks of bridge hacks and loss of funds cannot be alleviated.

Who bears the risk in case the risk engine fails?

There are three layers to risk mitigation:

  1. The protocol’s insurance pool takes the first loss.

  2. The protocol’s treasury as a second loss.

  3. Should (1) and (2) be depleted, the losses will have to be socialized amongst users.

Note: risk parameters significantly penalize supported protocols that do not have insurance pools or coverage themselves. This implies a de-facto first risk mitigation layer before August protocol gets affected.

Audits

Security audits don't eliminate risks fully. Please do not deposit more assets than you can afford to lose.

Zellic Audit - August 2023

Zellic Audit - March 2023

Sigma Prime Audit - August 2024

ChainSecurity Audit - January 2025

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Last updated 2 months ago

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2MB
2023.04.03 - Fractal Protocol - Zellic Audit Report.pdf
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2MB
22.03.18 - Fractal Final Report.pdf
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430KB
24.08.09 - SigmaPrime - Audit Report.pdf
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676KB
25.01.21 - ChainSecurity Audit.pdf
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