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Understanding Pragma Risks

By integrating Pragma, you agree to our terms and conditions.
Pragma offers pricing for a wide range of assets, both onchain and offchain, for developers to utilize in their applications. When integrating with our oracle solution, developers should be aware of the varying risk levels associated with different feeds.

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Market Risks

  • Risk Overview
  • Risk Factors
Our data publishers carefully select and use the best liquidity sources for each supported asset. However, inherent risks beyond the control of data publishers can affect pricing due to market manipulation. This is particularly true for long-tail assets where liquidity is provided by only a few actors.Developers integrating with Pragma should thoroughly understand these risks and conduct back-testing of every integration using Pragma’s available historical data.

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Risk Assessment System

To assist in evaluating risks, we’ve developed a comprehensive risk assessment system for each asset supported by the oracle. While this system is for informational purposes only, it should be used in conjunction with thorough testing before implementation.
Assets with a high number of publishers and diverse sources. The trading volume is high, and the probabilities of market manipulation are low as a result.
Characteristics:
  • Multiple independent data publishers
  • Diverse liquidity sources
  • High trading volume
  • Established market presence
These assets may possess characteristics that complicate accurate valuation or expose them to potential fluctuations, which could be problematic in certain scenarios.
Factors to consider:
  • Although the feed structure is robust and decentralized, these assets carry heightened market-related risks
  • Concentration of liquidity in a limited number of sources
  • Shifting market dynamics may contribute to this moderate level of risk
This asset typically displays an increased intensity of risk factors described in the “Moderate risk” category, or presents unique challenges that render its market price less predictable or stable.
By utilizing a High risk data feed, you confirm your awareness of the associated risks and accept full responsibility for monitoring and managing these risks independently.
You shouldn’t use feeds that we’re depreciating.
Depreciating feeds will be discontinued in the future. We recommend migrating to alternative feeds as soon as possible.
Check the risks of the assets we’re supporting on the integration page for each specific feed.

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Integration Risks

1

Thorough Evaluation

We’re passionate about Pragma and eager to assist you with integrating our oracle. However, it’s crucial to have a thorough process for evaluating the security of the integration.
2

Code Auditing

All code must be rigorously tested and audited, particularly:
The imports used to integrate the oracle
The code that interacts with the oracle
The logic that leverages the oracle’s data
3

Expert Assistance

We’d be happy to introduce you to top-tier auditors who can help ensure the security and reliability of your integration.
This auditing step is essential for maintaining the integrity of your project and maximizing the benefits of using Pragma.

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Risk Mitigation Best Practices

Back-testing

Thoroughly test your integration using Pragma’s historical data

Multiple Data Sources

Consider implementing failsafes with secondary data sources

Circuit Breakers

Implement circuit breakers to halt operations during extreme market conditions

Regular Monitoring

Set up continuous monitoring of feed performance and reliability
Contact our team to discuss risk mitigation strategies specific to your project needs.