Risk Management Strategies

Defx employs several strategies to manage and mitigate these risks:

• Comprehensive Smart Contract Audits: Periodic self as well as third-party audits to identify and rectify vulnerabilities.

• Regulatory Monitoring: Defx periodically audits regulatory developments to ensure compliance with relevant laws in the territories our exchange is available to operate in.

• Liquidity Incentives: Encouraging market makers to provide liquidity, thereby reducing the risk of significant price slippage.

• Reducing latency while hedging: With a combination of colocating DLE with the validator as well as centralised exchanges, and monitoring latency associated with hedging, the risk of DLE's drawdown is minimised.