The Edel Protocol leverages Aave’s battle-tested infrastructure to provide decentralized liquidity access with comprehensive risk management measures. Understanding these risks and their mitigation strategies helps you make informed decisions when using the protocol.
Protocol glossary showing key terms and concepts in the Edel ecosystem
All risk parameters are continuously monitored and can be adjusted through governance to respond to changing market conditions.

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Risk Categories

Smart Contract Risk

Code vulnerabilities and implementation bugs that could affect protocol security

Oracle Risk

Price feed accuracy and external data reliability concerns

Collateral Risk

Asset value fluctuations and liquidity considerations

Network Risk

Blockchain infrastructure and bridge security challenges

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Smart Contract Risk

Smart contracts may contain software bugs or vulnerabilities in protocol code and underlying reserve tokens.

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Mitigation Strategies

Aave Protocol Foundation
  • Built on Aave’s extensively audited and battle-tested codebase
  • Benefits from Aave’s multiple independent third-party security audits
  • Leverages proven smart contract architecture with years of production use
Edel-Specific Security Measures
  • We have currently not implemented any changes from the original Aave smart contracts
  • Check Diff here (COMING SOON)
  • Any future changes will be thorooughly audited before deployment
Continuous Security Monitoring
  • In addition to smart contract audits, we are working with TBD on day-one risk monitoring and parameterization of the Edel protocol to maintain protocol operations and to manage bad debt risk.

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Oracle Risk

Oracle dependencies introduce potential risks from incorrect price valuations or data feed failures.

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Risk Sources

Incorrect asset valuations can affect collateral calculations and liquidation thresholds
Security breaches or manipulation of oracle systems could impact protocol operations
Oracle downtime or connectivity issues may prevent accurate price updates

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Mitigation Approach

Decentralized Oracle Infrastructure
  • Multiple independent oracle nodes provide redundancy
  • Cryptographic proof mechanisms ensure data integrity
  • Real-time monitoring of oracle performance and accuracy