# Security and Risk ### **Audit Overview** Avon’s core contracts have been audited by five independent firms: Zellic, Guardian, Pashov Audit Group, Valkyri Security, and a public audit competition run by Cantina. Each review targeted different parts of the system, including strategy isolation, interest-rate logic, liquidation behavior, oracle adapters, and order book execution. All findings were fixed and revalidated, giving the protocol broad coverage before launch.
### **Security Principles** Avon removes discretionary behavior wherever possible. Strategies define their own rules and cannot borrow from each other. Interest curves are fixed in shape. All adjustable parameters are behind timelocks. The order book only reads published levels and cannot change strategy state. This keeps the system predictable and reduces the chances of cross-market failure. *** ### **Strategy-Level Risk** Risk in Avon is local. Each strategy carries its own collateral rules, LTV limits, interest curve structure, and oracle setup. A poorly designed strategy cannot affect others. Lenders choose the strategies they want to participate in, and borrowers see exactly which rules apply before taking liquidity. *** ### **Protocol-Level Risk** Protocol risk comes from the accuracy of the order book, the consistency of execution, and the reliability of oracle data. Avon depends on high-throughput chains where state updates remain fresh. The system is designed so that even if one strategy misbehaves, no shared pool or global curve can propagate risk across markets. *** ### **Liquidation Behavior** Liquidations happen inside each strategy independently. If collateral drops, only the affected component is liquidated. Other strategies remain untouched. This design avoids cascading liquidations and keeps lenders protected from unrelated market conditions. *** ### **Oracle Risk Model** Strategies choose their own oracle setup and often use a primary feed from **Chainlink Native Oracles** with a fallback from **Redstone Bolt**, or the reverse. If the primary feed becomes stale, the strategy switches to the fallback. Oracle risk stays inside the strategy, and a failure in one does not affect the rest of the protocol. *** ### **Known Limitations** Avon does not remove the need for careful strategy design. Strategies with aggressive LTVs or volatile collateral carry higher risk. Borrowers with multi-strategy exposure must understand that rate and health evolve separately in each part. The system also depends on the chain’s ability to keep state fresh; slow networks cannot support this architecture. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://avon-docs.gitbook.io/docs/avon/security-and-risk.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.