Understand the risks

Foreword

Alchemis puts a lot of emphasis on security as well as risk-diversification. Although we always improve every aspect of our own protocol's security, risks on the yield-earning protocols can never be completely controlled. Thanks to Analys, the risks are always taken into accounts when suggesting an investing strategy, but risks nevertheless are simply part of the crypto game. We advise every user to be cautious with their assets, cryptocurrencies involve risks.

Protocol-related risks

To begin, risks on the protocols side need to be addressed. There are mainly 2 types of risks on this level. The first one being that the protocol is a non-trustworthy scheme aiming to deceive users. These protocols unfortunately exist in the space and it is important to recall their existence. However, these risks are almost zero with Alchemis. The reason is that Analys had to run a complete evaluation of the project before letting users invest their assets in the protocol. In that sense, almost every recommended protocol is worthy of trust on the user side.

The second type of risk is the probability of a hack or other malicious attacks on a protocol. These sometimes happen in the space, therefore, Alchemis always recommends users a blend of multiple protocols, reducing the risks related to the weakness of one protocol.

Token-related risks

Next, token-related risks need to be addressed, these emerge from the natural unpredictability of the market, which could drive a certain asset's price down, which in turn reduces the performance of the investment strategy for this particular token. These risks are mitigated by high-diversification.