Crypto bear markets are known for their downturns and their liquidations for investors who are trading with leverage. On top of that, decentralized finance, or DeFi, projects can become targeted by hacks or suffer rug pulls, leading to enormous losses for investors of their tokens. Now new software seeks to alert investors in real-time about potential risks to their positions.
Users and executives from two such services, HAL and Aldrin, explain. HAL is a Web3 data infrastructure tool allowing companies or traders to track, monitor and trigger data. HAL recently launched simple API notifications on Avalanche (AVAX), which seeks to enable users on the blockchain to automate notifications of risky positions. Meanwhile, Aldrin is the first fully-audited decentralized exchange, or DEX, on Solana (SOL).
Marco De Rossi, the co-founder of HAL, explained that users can notify anyone on any channel of suspicious DeFi activities on an address with wallet monitoring. "We already have hundreds of Avalanche users playing with Pangolin (PNG), Sushiswap (SUSHI), Aave (AAVE) and also wallet monitoring and much more. In addition, TraderJoe is soon coming, as well as the top 10 Avalanche ecosystem apps in general," says Rossi.
Meanwhile, a HAL user, who wished to remain anonymous, told Cointelegraph:
"I use AAVE, and HAL directly integrated with them, allowing me to be notified if my position there becomes at risk; without me refreshing their dashboard, I can then take action quickly."
The anonymous user added that: "I may also want to be the first to know when something new comes up, and for this, HAL allows me to follow every new smart contract deployed by a developer I follow, that way, I can start my research faster and stay up to date."
Regarding the price volatility of tokens, Hisham Khan, founder and CEO of Aldrin, explained that it could be very difficult to execute trades manually and get a reasonably decent price. "If you're exposed to smaller or even mid-market cap tokens, the downside when Bitcoin or Ethereum breaks certain support levels is insane; you can lose 70% gain within 48 hours," said Khan.
He raised the example of rebalancing a portfolio of 25 tokens taking up to 30 minutes if done manually, but allegedly only seconds if done via Aldrin's rebalancing feature. "The automation features provided by Aldrin such as the Rebalancer and auto-rebalance when providing liquidity in pools saves me a lot of time," commented an Aldrin user, who wished to remain anonymous.
Like all DEXs, Aldrin faces potential security risks. But according to Khan, Aldrin has been fully audited and would thus have greater strength to combat those risks. He added:
"There is always the risk of impermanent loss risk that liquidity providers are exposed to. The projected returns [...] could be false or scams if the underlying token is not under Aldrin pools [...] but this is made clear as a disclaimer to the users."