Risk Terms

Protocol Risk

Definition

What is Protocol Risk?

The risk that a blockchain or decentralised protocol fails economically, technically, or through governance.

Example in practice

A flawed incentive design causes users to abandon the protocol.

Keep learning

The possibility of loss because broad market prices or rates move against an investment.

The possibility that a borrower or issuer will fail to make promised payments or suffer a downgrade.

The possibility that changing market interest rates will reduce an investment's value or income appeal.

A day on which relevant financial institutions and markets are open for normal processing.

Think you know your investing terms?

Put your knowledge to the test with a quick quiz.