> For the complete documentation index, see [llms.txt](https://docs.atoma.fi/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.atoma.fi/security/risks.md).

# Risks

A market-neutral vault is not risk-free. The share price can fall. You cannot lose more than you deposited.

| Risk              | What can happen                                                                          | How it is managed                                                                                                                    |
| ----------------- | ---------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------ |
| Venue             | A venue fails, freezes or becomes insolvent while holding vault capital.                 | Capital is spread across several venues.                                                                                             |
| Custody           | There is no third-party custodian; Atoma operates the trading wallet and venue accounts. | USDC leaves the contract only to pre-approved addresses, with a 24-hour delay on new ones.                                           |
| Funding           | Funding rate differences reverse, so a position pays funding instead of earning it.      | Positions are resized or closed when funding turns.                                                                                  |
| Price difference  | A price difference between venues widens before it converges.                            | Both sides are held at equal size.                                                                                                   |
| Liquidity         | RWA perpetuals are less liquid than major crypto markets, raising trading costs.         | Positions are opened and closed in parts.                                                                                            |
| Liquidation       | When the two sides sit on different venues, they do not share margin.                    | Margin is checked every 30 seconds; at the critical level the largest position on that venue is closed.                              |
| Smart contract    | A bug in the vault contracts causes a loss. There has been no manual third-party audit.  | OpenZeppelin ERC-4626 base, verified source, upgrades behind a multisig, [agentic audit](/security/agentic-audit.md) findings fixed. |
| NAV               | Atoma calculates the NAV; there is no independent administrator.                         | At most one NAV update every 30 minutes, with a change of at most 2%. Every update is on-chain.                                      |
| Withdrawal timing | A withdrawal takes one to two epochs plus settlement, and cannot be cancelled.           | All requests in an epoch settle at the same share price.                                                                             |
| Stablecoin        | USDC loses its dollar peg.                                                               | Native Circle-issued USDC only.                                                                                                      |