> ## Documentation Index
> Fetch the complete documentation index at: https://zyfai.mintlify.site/llms.txt
> Use this file to discover all available pages before exploring further.
# Risk Framework
Zyfai provides an independent risk assessment layer for DeFi yield strategies. Every pool available to Zyfai Agents has been assessed across three dimensions:
* Protocol-level risks
* Collateral-level risks
* Pool-level risks
This framework governs which opportunities your Agent can access and how they are continuously monitored after integration.
Live risk data: [risk.zyf.ai](https://risk.zyf.ai/)
***
## Strategy Tiers
Pools are classified into three risk-tiered strategies. Return expectations are averaged across market cycles on an approximate 3-year time horizon.
### Conservative
**Target native return (excluding incentives): 5–8%**
The Conservative strategy allocates exclusively to the most liquid, battle-tested pools and protocols. It prioritizes capital preservation above all else.
**Key constraints:**
* USDC only: no collateral swaps, no dual-LP positions requiring stablecoin swaps
* No principal tokens (PT)
* Protocol must have \$100M+ TVL and 36+ months live
* Pool TVL ≥ \$1M, liquidity ≥ \$500K
* No Leverage or Looping
**Collateral thresholds:**
| Asset Type | Min. Backing | Additional Requirements |
| ----------------------------- | ------------ | -------------------------------- |
| Stable assets | >100% | No depeg (≥0.5%) in 6 months |
| BTC / ETH / Offchain volatile | >125% | Market cap > \$100M |
| Alts | >140% | Liquidity > \$25M, 7d vol > \$1M |
### Aggressive
**Target native return (excluding incentives): 8–14%**
The Aggressive strategy includes all Conservative criteria with relaxed thresholds, opening access to higher-yielding opportunities with riskier collaterals and principal tokens.
**Key differences from Conservative:**
* Riskier collaterals and principal tokens (PT) are permitted
* Protocol must have \$25M+ TVL and 12+ months live
* Pool TVL ≥ \$250K, liquidity ≥ \$100K
**Collateral thresholds:**
| Asset Type | Min. Backing | Additional Requirements |
| ----------------------------- | ------------ | --------------------------------- |
| Stable assets | >100% | No depeg (≥5%) in 6 months |
| BTC / ETH / Offchain volatile | >115% | Market cap > \$30M |
| Alts | >130% | Liquidity > \$3M, 7d vol > \$300K |
### Yield Maxxing
**Target native return (excluding incentives): 10–18%**
The Yield Maxxing strategy includes all Conservative and Aggressive pools with async vaults (ERC-7540) added, subject to withdrawal period of 72 hours.
**Key differences from Conservative and Aggressive:**
* Includes async vaults (ERC-7540)
* Protocol must have \$10M+ TVL and 12+ months live
* Pool TVL ≥ \$100K, liquidity ≥ \$50K
**Collateral thresholds:**
| Asset Type | Min. Backing | Additional Requirements |
| ----------------------------- | ------------ | -------------------------- |
| Stable assets | >100% | No depeg (≥5%) in 6 months |
| BTC / ETH / Offchain volatile | >100% | Market cap > \$20M |
| Alts | >100% | Liquidity > \$1M |
For more on how strategies are selected and customized, see the [Yield Strategies](/docs/product/intelligence/strategies) page.
***
## Whitelisting Process
Before any pool is made available on Zyfai, it must pass through a structured whitelisting process covering the protocol, its collaterals, and the individual pool.
### Protocol Whitelisting
Each new protocol undergoes a comprehensive due diligence review.
**Technical Risks**
* Smart contracts audited by multiple renowned audit firms
* Audit less than 1 year old, or code unchanged since last audit
* No unresolved critical findings
* Use of tier-1 oracles (e.g. Chainlink, Pyth): no reliance on single DEX TWAP
* Exploit history reviewed; zero exploits in the past 12 months
**Operational Risks**
* Team has a relevant DeFi track record
* Active development (GitHub commits in the last 30 days)
* Multisig with ≥5 signers, ≥3 required: no single individual can rug
* Governance token distributed (top 10 holders \< 50%)
**Economic Risks**
* Source of yield assessed: sustainable fee-based models preferred over temporary incentives
* Can exit 100% of position with \< 3% slippage
* Pool is permissionless: no withdrawal queue, no NAV calculation
* For lending pools: exposure limited to whitelisted collaterals only
**Lindy Effect**
Protocols must meet minimum age and TVL thresholds corresponding to the target strategy tier:
* Conservative requires 36 months live and \$100M TVL
* Aggressive requires 12 months live and \$25M TVL.
### Collateral Whitelisting
Each collateral asset accepted in a lending pool is independently assessed. Data sources include CoinGecko, Chainlink/Pyth price feeds, GeckoTerminal/DexScreener, and official protocol documentation.
The assessment covers backing ratios, price stability (depeg history), market capitalisation, onchain liquidity, and trading volume. Specific thresholds differ by strategy tier as outlined above.
### Pool Identification
New pool opportunities are identified and reviewed on a daily basis. Each pool must meet the TVL and liquidity thresholds of its target strategy and must be hosted on an already-whitelisted protocol with whitelisted collaterals.
***
## Continuous Monitoring
Once a pool is live on Zyfai, it enters a continuous monitoring pipeline. These checks run automatically and are visible on the [Risk Dashboard](https://risk.zyf.ai/).
### Collateral Monitoring
All collateral whitelisting criteria are re-evaluated on a monthly basis. In addition, the following events are continuously monitored:
* **Stablecoin depeg events:** real-time detection of peg deviations for both base assets and collateral stablecoins in lending pools
* **New collateral additions:** when a curator whitelists a new collateral, it is automatically flagged and reviewed against listing criteria (liquidity, peg stability, backing)
### Pool Monitoring
* **APY stability:** flagged if the level falls outside 3σ of the 14-day rolling mean
* **TVL stability:** flagged if there is a 40% drawdown from the 30-day high
* **Combined APY + TVL check:** flagged if APY deviates by 2σ and TVL draws down 20% simultaneously
* **Utilisation and kink levels:** monitors interest rate model state to flag pools approaching the kink (sudden APY drops, potential withdrawal difficulty)
* **Liquidity vs. Zyfai TVL:** ensures Zyfai's exposure remains a safe fraction of available pool liquidity
* **Strategy classification review:** ongoing assessment that each pool is correctly categorized as Conservative or Aggressive
### Vault Structure Review
For protocols with hierarchical vault structures (e.g. Morpho curators), the complete allocation hierarchy is mapped: which underlying markets each vault allocates to, which collaterals are accepted, and how capital flows through the structure. This is reviewed continuously as curators adjust allocations.
***
## Risk Alerts
Zyfai provides real-time risk intelligence notifications covering the following events:
* Depeg event on the base asset
* Liquidity trap issue
* Pool not live