# Limitations

# Here we address key assumptions involved in building Collar

Users must be comfortable temporarily limiting upside in order to protect downside

  • This can be mitigated with rolls (we're developing a feature called auto-roll that leverage Keepers to request rolls automatically!)

Savvy marketmakers to participate in the protocol actively

  • Where there is money to be made, marketmakers tend to participate. We are partnered with two already for our private Beta

Lack of AMM liquidity

  • This is rarely an issue, after all, if there's no spot market, why even try to create products that are more complex.

Potential barriers to understanding and entry

  • Collar is a lot for the average user to understand, which is why we're committed to transparency and simplicity.

Declined pricing for rolls in highly volatile times

  • Marketmakers may not always provide roll pricing, which is a risk.

Lack of desire for marketmakers to quote the most volatile of tail assets

  • Marketmakers may not be willing to quote the latest dog, frog, or memecoin

Market impact upon sale of assets into DEX

  • It's arguably better to have the market absorb this sale in good times rather than bad, however market impact is largely unavoidable, as it's inherently bearish to borrow against an asset.