Risk center
The Risk Center aggregates every risk signal across the platform into a single, continuously updated view. It is how the treasury stays inside its limits.
Aggregated risk score
A single risk score is computed from the major risk dimensions:
| Dimension | What it measures |
|---|---|
| Concentration | Exposure vs the ≤ 2.5% per-position cap and per-index limits. |
| Lending health factor | Distance to liquidation on any leveraged/looped position. |
| Whitelist integrity | Whether routing targets are approved addresses only. |
| Deposit screening | KYC/AML/source-of-funds flags on inbound capital. |
| Impermanent loss | IL exposure across LP positions. |
| Cold-custody ratio | Share of assets in cold L4 custody vs hot deployment. |
Continuous monitoring
The AI Operator watches each dimension in real time and raises flags when a threshold is approached. The operator validates flags and acts:
- Concentration breach → trigger a rebalance.
- Health factor low → de-leverage (Lending controls).
- Depeg / exploit / governance signal → exit affected positions (lowest-score-first).
- Whitelist anomaly → block routing to the address.
Lending & leverage
Looping strategies are powerful but carry liquidation risk. The Risk Center monitors health factors continuously and de-leverages automatically as thresholds approach. The platform never loops into illiquid or thin collateral.
Defense in depth
Risk control is layered:
- Selection — only well-scored, deep, sustained-APY pools enter an index.
- Sizing — the 2.5% cap bounds any single failure.
- Monitoring — the Risk Center watches every dimension live.
- Execution rails — no fund movement without multisig + time-lock.
No single layer is relied upon alone — together they bound the treasury's downside.
Honest risk disclosure
YLDX presents risk honestly: drawdown, impermanent loss and leverage are real and disclosed, not hidden behind a headline APY. Diversification and discipline reduce risk; they do not eliminate it. See Disclaimers.