Overview
Exponential
Risk Ratings
Rating Scale
Our risk framework analyzes an opportunity holistically and assigns a rating based on the risks identified. The final rating factors in risk prevalence, importance, and convex relationships.
A
Best-in-class
Highest-rated pools with lowest risk of losing principal
B
Solid
Solid pools with low risk of losing principal
C
Speculative
Speculative pools with moderate risk of losing principal
D
Highly speculative
Highly speculative pools with large risk of losing principal
F
Extremely risky
Lowest-rated pools with highest risk of losing principal
A risk rating is an informed opinion about a DeFi investment's relative risk. It provides a framework to help investors evaluate opportunities and is just one aspect of an investor’s decision-making process.
Framework
Our risk framework is based on data and independent research from our team of experts. Once a risk is identified, it is evaluated according to our rubric, assigned a risk score, then converted into a rating from A-F.
Sample risk factors
Assets
Protocols
Chains
DeFi Graph
The Exponential DeFi Graph makes our framework scalable by mapping dependencies across assets, protocols, and chains to identify potential risks.
Compounding
Assets in DeFi can be built on top of one another (“money legos”), creating compounding risk vectors.
Centralization
Single points of failure can be present at the asset, protocol, or blockchain level.
Composability
Risk compounds when one vulnerability impacts an entire opportunity.
Why we need risk ratings
Risk ratings provide an industry standard for investors to use when evaluating DeFi yield opportunities.
Cover your blind spots
Spot risks before it’s too late.
Convex Market Making
FRAX DAI USDC USDT
F
3.09%
Invest based on your risk tolerance
From risk averse to full degen, our risk ratings have you covered.
Stargate Bridging
USDC
C
5.5%
Venus Lending
USDC
B
2.1%
Aave Ethereum
USDC
A
0.4%
Identify market inefficiencies
Cut through the noise - information asymmetries, low liquidity, high transaction costs, human psychology - and discover the best risk-adjusted opportunities in DeFi.
Benqi Lending
DAI
C
2.45%
Aave Lending
sUSD
B
1.98%