Risk Management
Layered defense, by design.
Five independent risk layers compose the protocol's solvency story. Each layer addresses a different failure mode — together they keep adverse market events from cascading into protocol-wide loss.
Rheofi pairs configurable parameters with structural safeguards to mitigate lending, liquidity, and oracle risks across every supported market. No single check stands alone — they reinforce each other.
Collateral factors
Each asset gets a borrowing-power factor reflecting its quality and liquidity. High-quality assets unlock more borrow; volatile assets stay conservative.
Liquidation thresholds
When a position's health factor drops below threshold, anyone can liquidate. Incentives are calibrated to attract liquidators without over-penalizing borrowers.
Supply & borrow caps
Per-market caps limit concentration. Supply caps prevent any one asset from dominating exposure; borrow caps cap maximum debt against each collateral type.
Market isolation
Higher-risk assets sit in isolated pools. A shortfall in an isolated pool affects only that pool's participants — never the broader protocol.
Oracle redundancy
Multi-source feeds with bound validation, primary/pivot/fallback layering. No single oracle failure can compromise pricing or stall the protocol.
Each layer addresses a distinct failure mode — a bad price, a sudden depeg, a flash-loan attack, a single concentrated borrower. Composed together, they turn isolated incidents into bounded events instead of protocol-wide crises.