General Risk Disclosures

Below are the main risks associated with CAP's current design.

Slashing execution risk

Slashing functions regulate activity within CAP. They safeguard the protocol and users from malicious agents as well as force majeure events related to yield generation. The ability of these functions to regulate activity rely on the efficient execution of slashing, when needed. There are several potential roadblocks in these operations, such as token risk of delegated tokens, particularly when engaging with liquid restaking token projects. Exposure to codebases at EigenLayer and other shared security markets also pose potential risks to slashing execution.

Pre-existing exposure risk

Users have one decision to make, and that is what tokens they wish to be exposed to. These tokens may fluctuate in price, especially in the case of gas tokens like BTC and ETH.