‼️Risks

General Risks

Legal Considerations

Users must understand the legal implications of their activities within NX Finance.

Tax Obligations

All tax-related outcomes from your transactions are your responsibility.

Market Fluctuations

The volatile nature of market prices means they can shift rapidly without warning, and historical trends may not predict future movements.

Unforeseen Risks

It's probable that there are additional risks not identified in this document.

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Solana Network Risks

Wallet Security

Loss of your wallet access results in an irreversible loss of funds stored in NX Finance.

Solana System Risks

Past instances of network halts have temporarily disabled on-chain functionalities. These could recur, potentially with extended or permanent impacts, leading to a complete loss of funds.

Service Fluctuations

The quality and timeliness of Solana's services may degrade, as evidenced by past occurrences.

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Oracle Risks

NX Finance utilizes Pyth oracles. Any disruptions, inaccuracies, or manipulations within oracle can lead to incorrect price feeds, affecting user transactions and potentially freezing accounts due to invalid oracle data.

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Token Risks

The interaction with Solana tokens carries inherent risks, including potential depegging of bridged or stablecoin tokens, which might trigger unintended liquidations.

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NX Finance Specific Risks

Program Vulnerabilities

The underlying Solana program of NX Finance may contain exploitable bugs leading to a range of issues from minor to catastrophic, including total fund loss.

Security Council Decisions

The Security Council, with delegated powers, can make rapid changes in response to security threats, potentially limiting platform functionality until a DAO vote can be conducted.

Margin Liquidations

Engaging in margin positions carries the risk of liquidation due to market shifts.

Socialized Losses and Cascades

Inefficient liquidations could result in negative equity, impacting even non-risky accounts, and large liquidations could trigger market movements leading to further liquidations.

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Service Dependencies

NX Finance depends on various services for data scraping, event processing, and user interface hosting. Disruptions or compromises in these services could impact the platform's operation and user experience.

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Trading Risks

Withdrawal Limitations

Withdrawal of tokens might be restricted if not enough tokens are available in the vaults due to lending activities.

Interest Rate Variability

Borrowing and depositing interest rates are subject to change based on token utilization, affecting returns.

Perpetual Market Risks

Limited liquidity could hinder position exits, and significant, rapidly changing funding rates could impact trades.