From the user's perspective, what are the strengths of TreehouseFi's risk protection mechanisms?
While innovation is certainly appealing, what everyone cares most about is safety. After all, there are many ups and downs in DeFi, with platforms collapsing, assets decoupling, and contract vulnerabilities... So how does TreehouseFi ensure protection? Let's look at a few specific measures.
First, it has established an insurance fund. If a platform encounters issues that lead to tAssets experiencing depeg, this fund will step in to subsidize losses, preventing users from being trapped or suffering losses without recourse.
Secondly, it has designed a PPP (Protocol-Owned Peg Protection) mechanism. When market fluctuations are significant and tETH prices are low, the protocol will automatically buy tETH to help stabilize its value. This proactive bottom-up approach is quite rare in DeFi.
Additionally, the DOR module does not let one person set the interest rate; instead, multiple participants contribute data, which increases accuracy and trustworthiness. This decentralized model with economic incentives makes the system more resilient to risks. For example, if there are data errors or deliberate fraud, submitters may be penalized with token fines, encouraging everyone to submit accurate and reasonable data.
Thus, TreehouseFi is not only innovatively attractive, but it has also designed several protective mechanisms, striving to prioritize user safety while pursuing returns, which shows considerable sincerity.
