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Risks

This is leveraged perp exposure. It can lose money quickly.

PerpTokens is market-structure-native. The risks are the risks of a leveraged perp position on a real venue: not custody or issuer risk, but very real all the same. The honest list:

• Wrong regime. Every token is designed for a market regime. A trend token bleeds in a range as rebalancing buys high and sells low; a range token bleeds in a strong trend as it keeps fading a move that continues. See Market views.
• Funding. Holding a perp position accrues funding, which can run against you and erode value over time.
• Spread. Crossing the order book costs the bid/ask spread on the way in and out.
• Slippage. Larger mints, redeems, and rebalances move price on the book; you pay the resulting execution cost.
• Thin liquidity. When the book is thin, spread and slippage widen and resizing becomes more expensive.
• Gaps. A sharp, fast price move can jump past where the rebalance band would have acted.
• Liquidation. Leverage is kept in band to resist drift, but a gap, thin liquidity, or rebalancers not acting in time can still liquidate the underlying perp. Resistant, not proof; see Keeping the strategy on target.