10.3 Technical Risks
Smart Contract Vulnerabilities
Risk:
Bugs or exploits in Solana programs could result in:
Loss of user funds
Incorrect market resolutions
Fee theft or manipulation
Protocol shutdown
Mitigation:
Tier-1 security audits (Zellic, OtterSec, Neodyme)
$100k+ bug bounty program
Gradual rollout (testnet → devnet → mainnet)
Emergency pause functionality (governance-controlled)
Insurance fund for critical bugs
Residual Risk:
Zero-day vulnerabilities may exist despite audits. Complex interactions between 4 programs increase attack surface.
Oracle Manipulation
Risk:
Oracles could collude to resolve markets incorrectly, stealing user funds.
Mitigation:
Economic security (staking requirements)
Commit-reveal prevents coordination
Slashing for dishonest oracles
Dispute mechanism with extended voting
Weighted voting (Sybil resistance)
Example Attack Analysis:
Residual Risk:
Highly motivated attackers with deep pockets could still attempt manipulation on high-value markets. Requires ongoing oracle network monitoring.
Solana Network Dependencies
Risk:
Path Protocol depends on Solana blockchain infrastructure:
Network outages (historical precedent)
Congestion during high demand
Consensus failures
Validator centralization
Mitigation:
Transaction retry logic in SDK
Graceful degradation during congestion
Priority fee implementation
Multi-RPC endpoint redundancy
Monitoring and alerting systems
Residual Risk:
Major Solana outages could temporarily halt trading. Markets would remain safe (funds locked on-chain), but UX degraded.
Last updated