Understanding the Risks

Smart Contract Vulnerabilities: Audits can be as rigorous as you like, but there’s no guarantee that some vulnerability in the smart contract can’t slip past without being noticed – in which case it could ultimately be exploited to either steal funds or otherwise compromise the proper operation of the network.

Market Volatility: Liquid staking and any paired DeFi offerings expose users to the turbulence of the crypto markets: an investment’s value (and the rewards it generates) can rise or fall with the prices of wTAO, swTAO and GDT.

Validator Performance and Slashing Risks: If validators fail to perform their duties properly or maliciously attempt to bring down the network, a slashing event occurs and some of their wTAO is forfeited.