Emergency Procedures

Handle emergency situations and protect your vault in crisis scenarios.

Note: FluxVault does not have built-in pause functionality. Emergency responses rely on monitoring, communication, ADL, and working with governance/protocol team.

Overview

As a vault curator, you must be prepared for:

• Oracle failures

• Market crashes

• Smart contract exploits

• Manager misconduct

• Extreme market conditions

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Emergency Response Plan

1. Oracle Failure

Symptoms:

• Liquidations not triggering

• Incorrect valuations

• Stale prices

Response:

1. Monitor vault health closely
2. Contact oracle provider immediately
3. Communicate with LPs about the situation
4. Consider using ADL if positions are at risk
5. Work with governance to address oracle issues

2. Market Crash

Symptoms:

• Rapid price declines

• Multiple liquidations

• Rising bad debt

Response:

1. Monitor liquidation performance
2. Verify oracles functioning
3. Track bad debt accumulation
4. Communicate with community
5. Assess need for parameter changes

3. Smart Contract Exploit

Symptoms:

• Unusual transactions

• Unexpected balance changes

• Security alerts

Response:

1. Alert community immediately
2. Contact protocol security team
3. Document exploit details
4. Monitor vault for ongoing issues
5. Work with governance on recovery plan

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Available Emergency Tools

Auto-Deleveraging (ADL)

Use ADL to free up liquidity during high utilization:

// Check if position can be ADL'd
(bool canADL, uint256 netEquity) = vault.STRATEGY().evaluateADL(vaultAddress, managerAddress);

// Execute ADL (only ADL Manager can call)
vault.executeADL(managerAddress, additionalWrappers, data);

See Auto-Deleveraging for details.

Withdrawal Failures

During crisis, withdrawals may fail due to insufficient liquidity:

1. Communicate with LPs about situation
2. Use ADL if available to free liquidity
3. Encourage manager repayments
4. Provide regular status updates

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Communication Plan

Channels

• Discord/Telegram announcements

• Twitter updates

• On-chain messages

• Email to known LPs

Templates

Oracle Failure:

ALERT: Oracle issue detected for [asset].
Monitoring all positions closely.
Working with oracle provider on resolution.
Existing positions being evaluated.
Updates every 30 minutes.

Market Crash:

Market volatility update: [X] liquidations processed. 
Current bad debt: [Y]%. 
Vault functioning normally. 
Monitor continuing.

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Recovery Procedures

After Emergency

1. Assess damage

2. Calculate bad debt

3. Review what happened

4. Implement improvements

5. Restore normal operations

6. Post-mortem report

Related Documentation

• Risk Management

• Monitoring Health

• Circuit Breakers