Reference
Risks & disclosures
The page most protocols bury. Read it before you deposit anything, not after.
You can lose your entire collateral. That is not a disclaimer formality — it is the actual worst case, and it has a mechanism.
Where this is not available#
Jurisdiction restrictions
Robinhood Chain is permissionless, but Robinhood Stock Tokens are not offered to residents of United States, Canada, United Kingdom or Switzerland. This interface applies geo-restriction and is not an offer or solicitation anywhere it would be unlawful.
Technical access to a permissionless chain is not permission. Whether you may lawfully use this product is a question for your own jurisdiction, and possibly for a lawyer in it.
What a stock token legally is#
Robinhood Stock Tokens are tokenized debt securities. They give you the economic exposure of the underlying equity — price movement, dividend economics, split adjustments — through an obligation, not through registered ownership.
- No voting rights in the underlying company.
- No entry on any share register.
- No direct claim on company assets in an insolvency.
- Exposure to the token issuer, in addition to the underlying equity.
CredX does not change any of this. It is a property of the collateral you chose, and it exists whether or not you ever borrow against it.
How you can lose money here#
As a borrower
| Risk | What happens | What reduces it |
|---|---|---|
| Collateral falls | Health factor drops; below 1.10 the protocol sells part of your position, below 1.00 a liquidator does | Draw well below your limit; diversify; repay early |
| Overnight or weekend gap | Price moves with no market to trade in; the buffer can be exceeded before anyone can act | Market-hours haircuts; leave extra room before long closures |
| Interest accrual | Debt grows slowly even if prices do not move | Auto-repay; fixed terms; monitoring |
| Rate spike | Variable rate can multiply if utilisation crosses the kink | Fixed-term draws |
As a lender
| Risk | What happens | What reduces it |
|---|---|---|
| Bad debt | Collateral gaps below the debt it secures; the shortfall hits the reserve, then lenders | Over-collateralisation; 15% reserve factor; conservative LTVs; caps |
| Withdrawal delay | At high utilisation there may not be idle liquidity to withdraw | The rate model, which makes repaying and supplying attractive fast |
| USDG depeg | Your position is denominated in a broken dollar | Nothing within CredX — this risk sits entirely with Paxos |
Affecting everyone
- Smart contract failure. A bug in the vault, rate model or liquidation path could lose funds. Audits and caps reduce the probability. Nothing removes it.
- Oracle failure. A wrong price could allow over-borrowing or cause a wrongful liquidation. Freshness gates and circuit breakers reduce this; they do not eliminate it.
- Governance and admin keys. Until governance is live, a multisig holds pause powers. That is trust, and it should be counted as a risk.
- Regulatory change. Tokenized equities are a young and contested area. Rules can change in ways that affect availability, liquidity or the tokens themselves.
Non-recourse#
Your loss is capped at your collateral
There is no mechanism by which the protocol can pursue you beyond the collateral in the vault. No personal guarantee, no clawback, no debt collection. The worst outcome is losing what you deposited.
Parameters are provisional#
Every LTV, liquidation threshold, liquidator bonus, cap and rate parameter across this site is a starting design. They have not been through the full derivation required before mainnet: historical volatility, on-chain liquidity depth, oracle behaviour under stress, and simulation against historical drawdowns.
They will change, and they should. Treat them as the shape of the system rather than as a commitment.
What this is not#
- Not investment advice. Nothing here is a recommendation to buy, sell or hold anything.
- Not tax advice. Whether borrowing is a taxable event where you live is a question for a professional there.
- Not legal advice. Including on whether you may use this product at all.
- Not a bank deposit. No deposit insurance, no regulator, no complaints process, no recourse.
- Not a guarantee of yield. Every rate shown floats and every projection is an illustration.
Current status#
Testnet software
What you can use today is a testnet deployment with mock stock tokens and mock USDG. It is provided as-is, for evaluation. Do not treat testnet behaviour as a promise of mainnet behaviour, and do not send real assets to any address associated with it.
If you have read this far and still want to try it, start with How it works and keep your first draw small.