# Trust and Safety

At Leverage.art, the safety of our users is our top priority. We employ industry-leading security measures to ensure that your data, assets, and personal information are always protected.

**Key Safety Features:**

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* **Margin & Liquidation logic**: ensuring maintenance margin thresholds, partial liquidation flows, and penalty enforcement work without exploits (e.g., griefing liquidations, undercollateralization).
* **Oracle integration**: verifying median-of-medians aggregation, outlier filtering, clamp rules, and pause mechanisms for oracle degradation.
* **Funding mechanism**: validating skew-based and volatility-adjusted funding to avoid manipulation.
* **Vault contracts (ERC-4626)**: securing P2P LP deposits, reward distribution, and ensuring no re-entrancy or withdrawal manipulation.
* **Best Practices**
  * **Third-party audits** by reputable firms with DeFi/NFT perp experience.
  * **Continuous auditing**: not just pre-launch, but with regular reviews after major updates.
  * **Bug bounty program**: incentivize white-hat disclosure of edge cases.
  * **Formal verification** (if feasible) of liquidation and funding settlement routines.

This ensures user trust in high-leverage markets where even small vulnerabilities can cascade into systemic losses.
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Fund custody and protocol upgrades are controlled through multi-signature wallets.

* **Operational Security**
  * **Treasury management**: protocol funds (fees, LP vault reserves, insurance fund) live in multi-sig wallets requiring approval from multiple signers before movement.
  * **Upgrade control**: any parameter changes (e.g., leverage caps, funding rate adjustments, oracle configs) pass through multi-sig approval, reducing single-actor risks.
* **Implementation on Base ETH**
  * **Gnosis Safe (or Safe{Wallet})** is the industry standard and natively supports Base.
  * Suggested config: **3-of-5** or **4-of-7** signatures, mixing internal team, trusted external advisors, and possibly DAO/community reps in the long term.
  * **Timelock governance** can layer on top: upgrade transactions are queued before execution, giving users time to react.

This provides resilience against compromised keys or rogue actors while maintaining operational agility.
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### Secure Trading Channels

High-leverage NFT perp markets need reliable trade execution without exposing users to exploits.

* **Execution Layer**
  * **Encrypted relayers**: Trades sent from user clients to execution engines (or intents) use TLS-encrypted channels to prevent interception or tampering.
  * **MEV protection**: minimize front-running and sandwich attacks by leveraging private order flow solutions (e.g., Flashbots Protect, CoW Protocol intent routing) when routing to onchain pools.
  * **On-chain settlement**: all trades are ultimately verified and settled via smart contracts on Base, ensuring transparency and immutability.
* **Oracle Protection**
  * Since NFT floors are noisy, secure transmission of Chainlink feeds, OpenSea API data, and AMM TWAPs is critical.
  * Your **median-of-medians with clamping** already acts as an anti-manipulation guardrail; audits should verify integrity of data handling and fallback logic.
* **User Safeguards**
  * **Session key trading**: allow short-lived, scoped keys for trading without exposing primary wallet keys.
  * **Two-factor confirmations**: optional for large trades or withdrawals.

Together, this builds a secure execution environment that defends against both protocol-level exploits and user-targeted attack vectors.
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