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Using Ultramarkets involves risks. Understand them before depositing funds.

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Smart Contract Risk

Ultramarkets runs on smart contracts that control deposits, positions, and withdrawals. Bugs or vulnerabilities could result in loss of funds. We mitigate this through audits and careful development, but no system is risk-free.

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Market Execution Risk

Positions are executed on Polymarket. If Polymarket experiences downtime, liquidity issues, or technical problems, we may not be able to open, close, or liquidate positions as expected. This could affect both traders and LPs.

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Liquidity Risk

For Traders

Low liquidity markets may have wider spreads and higher slippage. Your actual entry and exit prices may differ from displayed prices.

For LPs

When vault utilization is high, withdrawals may be delayed until positions close and capital returns. In extreme scenarios, you may need to wait or sell umUSD on the secondary market.

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Liquidation Risk

At high leverage, small price movements can trigger liquidation. At 10x, a ~5.5% adverse move liquidates your position. Prediction markets can move quickly on news. Monitor your positions actively.
High leverage = high risk. Always use leverage appropriate to your risk tolerance and experience level.

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Oracle and Resolution Risk

Prediction markets depend on accurate resolution. While we select markets with clear, authoritative sources, disputes or unexpected resolution outcomes on Polymarket could affect position values.

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Regulatory Risk

Prediction markets and leveraged trading operate in an evolving regulatory environment. Changes in laws or enforcement could affect access to Ultramarkets or underlying markets.