Risk framework
There are real risks in using MakeBanc. This page maps them. The following pages address each in detail.
Why this exists:
Most platforms bury risk disclosures in footnotes and legalese. MakeBanc lists them here, in plain language, at the top.
If you cannot accept them, this is the wrong platform for you. That is a valid outcome.
The four risk categories:
Four categories matter when allocating to a MakeBanc vault.
Technology risk. Smart contracts, blockchain infrastructure, oracles, or platform code fail in a way that causes loss.
Counterparty risk. An institution involved in the platform (the custodian, asset manager, or infrastructure provider) fails, defaults, or acts against your interest.
Strategy risk. The trading strategy loses money through market movements or specific failure modes.
Operational risk. Human error, key compromise, social engineering, or process failure, within the asset manager's organization or your own.
Each has its own page. Each has mitigations and residual risk you should understand.
What is and is not insured:
Technology risk on the underlying smart contract infrastructure is covered by insurance from Breach (technology-risk coverage, currently in progress) at the protocol level. You do not need to activate it or pay extra.
Counterparty risk is mitigated through regulated institutional counterparties (Ceffu for custody, Noah for fiat), not insurance.
Strategy risk is not insured. MakeBanc does not reimburse trading losses. Ever.
Operational risk is mitigated through process and segregation of duties. Not insured.
If you can accept strategy risk, the other categories have meaningful mitigations. If you cannot accept any losses, this platform is not for you.
The risk you cannot eliminate:
Strategy risk is irreducible. The strategy can lose money. It can lose money for months. It can lose money in ways the track record did not predict.
This is true of every strategy on every platform. MakeBanc's job is to give you good information, transparent reporting, and clean settlement mechanics. The strategy's performance is the strategy's performance.
If you cannot accept capital loss from strategy performance, do not allocate.
The risk you should evaluate carefully:
Technology risk deserves the most attention. The platform runs on smart contracts. Smart contracts can have bugs. Bugs can cause loss.
The mitigations are real: audited contracts, time-locked upgrades, asymmetric pause logic, threat modeling, monitoring, and insurance from Breach (technology-risk coverage, currently in progress). The residual risk is also real. No smart contract is provably bug-free.
Read the technology risk page. Review the audit reports. Decide if the residual risk is acceptable.
How to decide:
Use the four categories as a checklist. For each, ask:
What is the worst plausible outcome? What mitigations exist? What residual exposure remains? Can I accept it?
Yes for all four, the platform may be appropriate. No for any, it is not, and that is fine.
You are not failing by deciding not to allocate. You are doing the same work serious institutions do before deploying capital.
What this is not:
This page is a map, not a substitute for reading the detailed risk pages.
Nothing here is investment advice. The risk landscape evolves; new attack vectors emerge, new regulatory considerations arise. If you find a risk that is not addressed honestly, tell the team.