In r/defi, builders debate whether spreading funds across chains and lending protocols reduces risk or increases complexity, highlighting correlation via shared oracles and smart contract failure modes.
I've got funds spread across Aave on Ethereum, Kamino on Solana, and Compound on Arbitrum.
Liquidations, rate changes, smart contract risks each protocol has its own failure points.
I'm starting to think that diversification across chains might be riskier than just picking one solid protocol and sticking with it.
The biggest risk most people miss is correlation.
Having positions across 5 different lending protocols feels diversified until you realize they're all on the same chain, using the same oracle
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