Risks

Symbiotic Core V2 is designed to be highly modular, allowing vaults, applications, operators, and allocators to define their own risk and reward profiles. As a result, participants should carefully understand the assumptions and responsibilities associated with every integration before interacting with the protocol.

Applications

Applications should carefully evaluate the economic security backing their systems. This includes selecting appropriate collateral, working with reliable operators, and diversifying security across multiple vaults where possible. Slashing conditions should be clearly defined, transparent, and proportional to the responsibilities expected from operators.

Applications should also understand how participating vaults generate yield. Some vaults may utilize Liquidity Adapters or other external strategies, which may introduce additional operational and financial risks beyond the application's own infrastructure.

Curators

Curators are responsible for defining how vault capital is utilized and therefore play a central role in the overall risk profile of a vault. Before enabling applications or Liquidity Adapters, curators should understand the operational assumptions, financial risks, and potential failure modes of each strategy.

Administrative permissions should be managed carefully, ideally through multisigs or similarly secure operational setups. Curators should also regularly review vault allocations, adapter configurations, and operational limits to ensure they continue to reflect the intended strategy.

Allocators

Allocators should evaluate the complete vault strategy rather than focusing solely on the expected yield. Different vaults accepting the same collateral may expose capital to very different applications, operators, or external protocols.

When a vault utilizes Liquidity Adapters, allocators should additionally understand the risks of the underlying protocols or tokenized assets receiving capital, including liquidity constraints, smart contract risk, and, where applicable, issuer-specific risks associated with RWAs.

Operators

Operators should only participate in applications whose operational requirements they fully understand. As delegated vault collateral backs their activities, failure to satisfy an application's requirements may result in slashing.

Maintaining reliable infrastructure, secure operational practices, and continuous monitoring is essential to minimizing operational risk and protecting both delegated capital and the operator's reputation.

General Recommendations

Regardless of their role, all participants should verify contract addresses using the official deployment documentation, carefully review administrative permissions, and thoroughly test integrations before deploying to production environments. As the protocol evolves, participants should also stay informed about Core upgrades, adapter releases, and updated operational recommendations.