Forwarded from DL Research
What could go wrong? Understanding protocol risk with Exponential
Welcome back to the second instalment of our coverage on Exponential's risk ratings series.
Our coverage on pool risk using Exponential’s rating framework broke down how a pool strategy works. Next, we’ll focus on understanding the foundation these strategies are built on by analysing protocol risks, scouring for cracks in the code, red flags within governance structures, and the overall durability of a protocol.
At DL Research, we’ve seen how even promising protocols can falter under the weight of bugs, governance disputes, or rushed upgrades. Protocol risk is the litmus test for resilience, a crucial lens for separating sustainable opportunities from short-lived hype.
So, how does Exponential arrive at these scores? Their framework breaks protocol risk into three components:
1️⃣ Code quality,
2️⃣ Protocol maturity,
3️⃣ and Design.
We unpack each in our latest coverage of Exponential’s risk framework. Read the full article here 🦙
Welcome back to the second instalment of our coverage on Exponential's risk ratings series.
Our coverage on pool risk using Exponential’s rating framework broke down how a pool strategy works. Next, we’ll focus on understanding the foundation these strategies are built on by analysing protocol risks, scouring for cracks in the code, red flags within governance structures, and the overall durability of a protocol.
At DL Research, we’ve seen how even promising protocols can falter under the weight of bugs, governance disputes, or rushed upgrades. Protocol risk is the litmus test for resilience, a crucial lens for separating sustainable opportunities from short-lived hype.
So, how does Exponential arrive at these scores? Their framework breaks protocol risk into three components:
1️⃣ Code quality,
2️⃣ Protocol maturity,
3️⃣ and Design.
We unpack each in our latest coverage of Exponential’s risk framework. Read the full article here 🦙