This page will describe risks that a user must know before using the Lido protocol

Smart Contract Security

The security of Lido must be the Lido DAO’s highest priority from the time of its deployment. Users should investigate the risks involved with Lido before engaging with it. There is an inherent risk that Lido could contain vulnerabilities or bugs causing, among other things, the complete failure of Lido and/or its parts.

Kusama Technical Risks

Lido on Kusama is built on top of experimental technology under active development. There is no guarantee that the Kusama chain network will be error-free or have a minimum uptime. Failures in Kusama might lead to validators slashing and result in a significant drop in the balance and price of the stKSM token.

Slashing risk

Kusama chain validators are at risk of receiving slashing (for going offline or double signing, for example). In the worst case, when a lot of validators misconduct simultaneously, up to 100% of the stake can be slashed. To mitigate this risk, the stake is distributed to a plethora of professional and reputable node operators with heterogeneous setups.

stKSM Price Risk

Besides the risk associated with validators' slashing and an stKSM token balance drop, there is a chance that the exchange price of stKSM will be less than a fair price for a while.