Risk Disclosure

1. You can lose all the money you put in

This page summarises the main risks of using HoodSafe. It cannot list every possible risk. It forms part of our Terms of Service.

2. Market and liquidity risk

• Volatility: prices of tokens, especially newly launched or low-capitalisation tokens (“memecoins”), can move by tens of percent in seconds. Past performance, including returns shown in signals or leaderboards, is not a reliable indicator of future results.
• Liquidity: some assets have very small pools. You may be unable to sell, or only at a much worse price than displayed, and large orders move the price against you (price impact).
• Slippage and failed transactions: the executed price can differ from the quote within the slippage you allow. Failed transactions still cost network fees.
• Scams and malicious tokens: tokens may be honeypots, have hidden taxes, blacklists, mint functions or upgradeable code, or be abandoned by their creators (“rug pulls”). Our risk flags and checks are best-effort and can miss these.

3. Tokenised stocks

• Not the share itself: a stock token tracks an underlying share or fund but is a separate instrument issued by a third party. Unless the issuer’s terms say otherwise, you have no shareholder rights such as voting or a direct claim on the company.
• Issuer and structure risk: your exposure depends on the issuer, its custody of the underlying assets and its terms. Its failure, a regulatory action or a change of terms can reduce the token’s value or tradability.
• Trading hours and gaps: tokens may trade when the underlying market is closed, while price feeds update slowly or not at all. When the market reopens (for example on Monday), prices can jump in one step (“gap”). Corporate actions such as splits or dividends may be handled differently from the shares.
• Eligibility: stock tokens are not available to U.S. persons and may be restricted in other countries.

4. Borrowing and liquidation

• Liquidation: when you borrow against collateral (for example on Morpho), a fall in the collateral price or a rise in your debt can push the position past its liquidation threshold. Anyone may then repay part of your debt and take your collateral at a discount. Liquidations are automatic, can be partial or total, and can happen at any time.
• Weekend and gap risk: with stock tokens, a price gap at the market open can move a position from safe to liquidated in one oracle update, with no chance to react.
• Oracle risk: liquidations are based on on-chain price oracles, which can be delayed, wrong or manipulated.
• Variable interest: interest rates change with market utilisation and can rise quickly, increasing your debt.
• Safety features are limited: HoodSafe’s borrowing cap and liquidation alerts reduce, but do not remove, liquidation risk. Alerts can be late or fail.
• Repaying needs the loan asset: repaying in full requires the borrowed asset plus accrued interest. The HoodSafe origination fee is taken from the amount you borrow, so closing immediately requires slightly more than you received.

5. Automated trading and signals

• Snipers, auto-buy, take-profit/stop-loss, copy and signal-based features execute mechanically. They may:
  • buy tokens that turn out to be scams;
  • trigger on manipulated or erroneous prices;
  • execute repeatedly in volatile markets;
  • fail to trigger because of network, RPC or liquidity problems.
• Speed matters in new launches, and other participants, including bots and block producers, may act before you (front-running, sandwich attacks).
• Scores, “smart money” labels, whale tracking and other analytics are automated interpretations of public data. They are not advice and can be wrong.

6. Technology, smart-contract and blockchain risk

• Smart contracts can contain bugs or be exploited. This applies to HoodSafe’s own contracts (for example the trade router and token locker) and to third-party protocols, and can lead to a total loss of funds.
• Blockchain networks can be congested, halted, reorganised or forked. Robinhood Chain is a relatively new network and depends on its operators and infrastructure.
• Third-party providers can be unavailable or return wrong data. These include RPC nodes, aggregators, explorers, oracles and Telegram.
• Irreversible transactions: transfers to a wrong address or network, or approvals given to malicious contracts, are usually permanent.

7. Hosted-wallet and account risk

• The private key of your HoodSafe wallet is stored encrypted by HoodSafe so that our systems can sign your transactions. A security breach of our systems or of your Telegram account or devices could lead to loss of funds. You can reduce this risk by:
  • keeping only the amount you actively trade in your HoodSafe wallet;
  • exporting your key or moving your funds to a wallet you alone control.
• Anyone who controls your Telegram account or a signed-in session may be able to trade with your funds. Protect them with strong security, including Telegram two-step verification.
• We may need to suspend or restrict accounts for legal or security reasons, which can temporarily delay access to the Services.

8. Legal, regulatory and tax risk

• The legal treatment of crypto-assets, tokenised stocks and decentralised protocols is evolving and differs between countries. New laws, regulatory actions or sanctions can restrict the Services, particular assets, or your ability to use them.
• You are responsible for determining and paying any taxes on your transactions and for keeping records. Consult a tax adviser.

9. Accuracy of information

Prices, balances, profit and loss, liquidation prices, APYs and other figures on HoodSafe come from blockchains, oracles and third-party data providers. They can be delayed, estimated or wrong, and can change between display and execution. Always check the confirmation screen and, where it matters, the blockchain itself.