Define "Smart Contract Risk" in the Context of Lending Protocols ⎊ Path

Define “Smart Contract Risk” in the Context of Lending Protocols.

Smart contract risk is the potential for financial loss due to a bug, exploit, or flaw in the underlying code of the decentralized application. In lending protocols, a flaw could allow an attacker to drain the liquidity pool, manipulate interest rates, or steal collateral, leading to an immediate loss of funds and a total collapse of confidence.

What Is the Primary Security Risk of Using a Smart Contract as a Custodian?

What Is the Risk of a Bug in an Immutable Smart Contract?

What Is “Smart Contract Risk” in DeFi Derivatives?

What Happens If There Is a Bug in the Smart Contract Code Governing an Options Trade?

Define ‘Systemic Risk’ in the Context of the Crypto Financial System

What Is the Primary Risk Associated with a Smart Contract for Settlement?

What Is the Risk Associated with an Unchangeable Smart Contract Bug in a Financial System?

How Is ‘Smart Contract Risk’ Different from ‘Market Risk’ for a Treasury Asset?