# Dangers

Some of the main risks are:

**Smart contract risk**\
Errors in the smart contract are always a possibility. Risks include but are not limited to resources getting stuck or resources being drained.

**Liquidation risk**\
When a loan's collateralization ratio falls under the MCR, it is possible to be liquidated. This leads to having to pay the liquidation penalties.

**Oracle risk**\
Manipulation of the oracle(s) we use can lead to inaccurate liquidations and other actions that should not be possible.

**Depeg risk**\
Market conditions could lead STAB to trade at a price far from the (target) internal price. Were this to happen repaying a loan (or liquidating), might become unfeasible.


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