> For the complete documentation index, see [llms.txt](https://docs.realfi.co/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.realfi.co/risks-and-disclaimer/what-are-the-risks-of-using-the-realfi-protocol.md). # What are the risks of using the RealFi protocol? * Smart contract risk is the possibility that the protocol's code contains undiscovered vulnerabilities that could result in loss of funds. * Peg risk is the possibility that USDr could deviate from its target value due to market stress or arbitrage failure. * Reserve risk is the possibility that the underlying portfolio underperforms or experiences defaults that reduce the value of sUSDr. * Regulatory risk is the possibility that future regulatory developments affect the protocol's ability to operate in a jurisdiction or change the legal classification of the tokens. * Liquidity risk is the possibility that redemption queues, market liquidity, or circuit breaker activations prevent timely exit. * Counterparty risk is the possibility that protocol service providers, custodians, or borrowers in the underlying portfolio fail to perform their obligations. * Technology risk is the possibility that protocol infrastructure, including the Cardano blockchain and supporting systems, experiences outages or failures. * sUSDr holders additionally absorb portfolio losses before USDr holders are affected. USDr and sUSDr are not bank deposits and are not insured. Capital is at risk. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://docs.realfi.co/risks-and-disclaimer/what-are-the-risks-of-using-the-realfi-protocol.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.