GLIF Docs
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V2 English
  • Introduction
    • Quick Guide
    • GLIF Overview
    • Protocol Users
  • For Liquidity Providers
    • Benefits for token holders
    • GLIF Reward Mechanism - iFIL
    • Exit - Withdraw FIL
    • Asset Security
    • Risks
  • For Storage Providers
    • Benefits for Storage Providers
    • SP Liquidation Values
    • Borrowing Limits & DTL
    • Uses of Borrowed FIL
    • Liquidations
    • Borrowing Cost
    • Manage Miner Actors with Agents
    • Guarantor Model
  • Developer Resources
    • GLIF SDK
    • GLIF CLI
    • Deployed Contracts
  • TROUBLESHOOTING
    • FAQ
      • FAQ for Liquidity Providers
        • About GLIF
        • Deposit FIL
        • Withdraw FIL
        • Risk
        • Wallet Connection
        • GLIF Points
        • Miscellaneous
      • FAQ for Storage Providers
        • Borrow and Withdraw FIL
        • Key Financial Ratio
        • Payment
        • Liquidation
        • Agents
        • Transaction Issue
    • TUTORIALS
      • For Token Holders
        • Wallets
          • How to find your corresponding 0x/f410 wallet address
          • How to obtain a Ledger wallet as the intermediary wallet
          • How to obtain a burner wallet as the intermediary wallet
          • How to obtain a FilSnap wallet as the intermediary wallet
          • How to connect your wallet to Filecoin Mainnet
          • How to transfer FIL from a 0x address to an f1 address
          • How to create a multisig wallet on GLIF
        • Using the Pool
          • Deposit FIL into GLIF to earn rewards
          • How to deposit Filecoin from a hardware wallet with GLIF
          • How to deposit FIL to GLIF using multisig wallet
          • Withdraw FIL from GLIF
          • How to withdraw FIL from GLIF using a multisig wallet
        • Transfer FIL to/from exchanges
          • Transfer FIL between exchange and GLIF
          • Binance
            • Transfer FIL from Binance to GLIF
            • Transfer FIL from GLIF to Binance
          • MEXC
            • Transfer FIL from MEXC to GLIF
            • Transfer FIL from GLIF to MEXC
      • For Storage Providers
        • GLIF Agent Website Tutorial Part I— Preparation Setup
        • GLIF Agent Website Tutorial Part II — Create your Agent
        • GLIF Agent Website Tutorial Part III — Add Your Miner
        • How to withdraw FIL from the agent to an exchange at GLIF
      • How to Claim $GLF Airdrop
    • Glossary
    • Contact Us
  • Governance
    • Governance
    • Delegation
    • Proposals (GIPs)
    • Voting Process
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On this page
  • Smart contract risk
  • Financial Math risk
  • Consensus Fault Risk
  1. For Liquidity Providers

Risks

How GLIF works to minimize risks

PreviousAsset SecurityNextBenefits for Storage Providers

Last updated 10 months ago

Smart contract risk

With any DeFi protocol, the risks of malicious hacks and bugs must be considered. While these risks naturally decrease over time as the protocol proves its resilience.

To mitigate smart contract risk, GLIF:

  • has undergone multiple professional security audits

  • constantly monitors the protocol for unusual activity and behavior

  • controls admin functionality to pause the contracts in case of malicious behavior or attacks

  • continuously runs ongoing live data checks to ensure the contracts are operating correctly

Financial Math risk

In the previous , we discussed liquidation value—the FIL recovered in a liquidation event. A key risk is overestimating the liquidation value of a specific Storage Provider (SP) in the system. In the case of a liquidation value overestimation, the protocol may recover less assets in a liquidation than expected, which could create losses for Liquidity Providers (LP).

To mitigate the possibility of overestimation, GLIF monitors are continuously simulating Miner liquidations to check results every 24 hours.

Consensus Fault Risk

One attack vector an SP could use to create losses for LP is to commit consensus faults to the Filecoin network. This would essentially mean the SP submits invalid blocks to the network, resulting in more severe penalties. However, in an event described above, the SP would lose far more FIL tokens than any LP would lose, so there is no game theoretical or financial incentive to attack GLIF by committing consensus faults to the Filecoin network.

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