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Risk Disclosure

Trading perpetual contracts involves significant risk, particularly when leverage is used. Denaria provides a mobile trading layer through which users interact with perpetual markets and liquidity infrastructure provided by integrated protocols such as GMX on Arbitrum.

Denaria does not eliminate the risks associated with the underlying protocols, blockchain infrastructure, smart contracts, market conditions, or leveraged trading.

Users should understand these risks before opening a position.

General Risks​

  • Blockchain Infrastructure Risk: Denaria currently operates on Arbitrum One. Users therefore inherit risks associated with Arbitrum, Ethereum, blockchain networks, bridges, RPC infrastructure, network congestion, outages, reorganizations, or other technical failures.
  • Underlying Protocol Risk: Trading through Denaria currently relies on GMX markets, liquidity, smart contracts, and execution infrastructure. Bugs, exploits, economic attacks, governance decisions, configuration changes, or other issues affecting GMX may consequently affect Denaria users.
  • Smart Contract Risk: Onchain protocols rely on smart contracts. Audits, testing, and security reviews can reduce risk but cannot guarantee that smart contracts are completely free from vulnerabilities or unexpected behavior.
  • Oracle and Price Feed Risk: Perpetual markets depend on external price data to determine execution prices, position PnL, and liquidations. Incorrect, delayed, unavailable, or manipulated price data could negatively affect positions.
  • Stablecoin Risk: Users may use stablecoins or other supported assets as collateral. These assets can lose their intended value, experience liquidity problems, or become subject to issuer, protocol, bridge, or market risks.
  • Liquidity Risk: Market liquidity can change rapidly. During volatile or stressed market conditions, users may experience increased price impact, difficulty executing at the expected price, or unfavorable conditions when opening or closing positions.
  • Third-Party Infrastructure Risk: Denaria integrates external infrastructure including GMX, Arbitrum and ZeroDev. Disruptions or vulnerabilities affecting these systems may impact the availability or functionality of Denaria.

Denaria Trading Layer Risk​

Denaria provides the user-facing trading interface through which users interact with underlying onchain markets.

Because execution ultimately depends on external protocols, the availability of the Denaria interface does not guarantee that an order will be executed, executed immediately, or executed under the conditions initially displayed.

Potential risks include:

  • temporary interface or API unavailability;
  • delayed or outdated information displayed in the application;
  • transaction submission failures;
  • network congestion or failed blockchain transactions;
  • differences between a quoted value and the final onchain execution;
  • temporary inability to access certain integrated markets.

The state recorded onchain and by the underlying trading protocol ultimately determines the status of a position or transaction.

Trader Risk​

Trading perpetual contracts is inherently risky. Leverage significantly amplifies both profits and losses.

1. Market Risk​

The price of the underlying market can move against a trader's position.

A trader who opens a Long position generally loses money when the market moves downward, while a trader who opens a Short position generally loses money when the market moves upward.

Volatile markets can experience large price movements over very short periods.

2. Leverage Risk​

Selected Denaria markets may support leverage of up to 100×.

Higher leverage reduces the amount of adverse price movement required to produce substantial losses or trigger liquidation.

A highly leveraged position can therefore lose most or all of its collateral following a relatively small market movement.

3. Liquidation Risk​

If the value of a position falls below the margin requirements established by the underlying trading protocol, the position may become eligible for liquidation.

Liquidation can result in the loss of part or all of the collateral allocated to the position.

Users are responsible for monitoring their positions and maintaining sufficient collateral.

4. Funding and Trading Fee Risk​

Perpetual positions may incur funding, borrowing, execution, price impact, or other protocol fees depending on the underlying market and trading infrastructure.

These costs can accumulate while a position remains open and reduce its profitability or contribute to liquidation risk.

5. Execution and Price Impact Risk​

The price displayed when preparing a trade may differ from the final execution price.

Market volatility, liquidity conditions, position size, price impact, blockchain latency, and changes occurring before transaction confirmation can all affect execution.

6. Take Profit and Stop Loss Risk​

Take Profit and Stop Loss orders are risk-management tools, but they do not guarantee execution at an exact price.

Rapid price movements, liquidity conditions, oracle updates, network issues, or limitations of the underlying trading protocol may result in execution at a different price or prevent an order from executing as expected.

Global Market Risk​

Denaria provides access to perpetual markets representing different asset classes, including crypto, commodities and global financial markets.

These markets can behave differently and involve distinct risks.

In particular:

  • the reference market for an asset may have specific trading hours even while the perpetual market remains accessible;
  • prices may move sharply around the opening or closing of traditional markets;
  • macroeconomic announcements can cause sudden volatility;
  • commodity markets can be affected by geopolitical events, supply disruptions, inventories and other market-specific factors;
  • perpetual prices may temporarily diverge from the price traders expect from the referenced underlying market.

Users should understand the characteristics of each market before trading it.

Wallet and Passkey Risk​

Denaria uses smart accounts and passkeys powered by ZeroDev to provide a simplified wallet experience.

Users remain responsible for securing access to their account and devices.

Potential risks include:

  • losing access to the device containing a passkey;
  • compromised devices or authentication credentials;
  • unauthorized access to the user's email account;
  • incorrectly configuring or failing to configure a Guardian;
  • approving a malicious or unintended transaction.

Denaria provides a Guardian-based permissionless recovery mechanism that can help users replace a lost passkey.

However, users should configure a trusted Guardian before losing access to their original passkey. A Guardian should only be assigned to someone the user trusts to correctly verify and approve a legitimate recovery request.

Denaria does not have access to user passkeys and cannot independently recover a user's wallet.

Important Notes​

  • Perpetual trading is high risk and may result in the complete loss of the collateral allocated to a position.
  • Leverage magnifies both gains and losses.
  • Denaria provides access to underlying trading infrastructure but does not remove the risks associated with that infrastructure.
  • Users are responsible for understanding the markets, protocols and transactions they interact with.
  • Risk-management tools such as Stop Loss orders reduce risk but cannot eliminate it.
  • Past performance does not guarantee future results.
  • Users should never trade with funds they cannot afford to lose.