Is Bucket Protocol V2 Safe?
Risk Grade: B- (35/100)
Bucket Protocol V2 is rated as moderate risk — some novel mechanisms, generally well-understood.
Moderate risk — well-designed CDP protocol with multiple peg stability mechanisms, but oracle dependency and Sui immaturity create meaningful risk during market stress.
Bucket Protocol V2 is the first CDP protocol on Sui, allowing users to deposit SUI, BTC, or ETH as collateral to borrow BUCK stablecoin at zero interest. With $12M TVL, it features a stability pool (Tank), peg stability module (PSM), and savings pool. It uses Liquity-inspired mechanics adapted for Sui.
TVL
$10M
Mechanisms
7
Interactions
5
Value Grade
D+
Key Risks for Bucket Protocol V2 Users
If SUI price drops sharply, your collateral could be liquidated
BUCK depends on multiple stability mechanisms that could fail during extreme conditions
Sui ecosystem is young, limiting where you can use BUCK
Top Risk Factors
- •BUCK peg stability depends on multiple modules (PSM, CDP, Tank, redeem) — failure of any could break the peg
- •Oracle dependency for SUI, BTC, ETH creates liquidation risk during rapid price drops
- •Zero-interest borrowing may create adverse selection and bad debt accumulation
- •Sui ecosystem still young with limited DeFi composability for BUCK
How Bucket Protocol V2 Compares to Peers
Bucket Protocol V2 ranks #9 of 25 CDP protocols (above-median). At a risk score of 35/100, it's in line with the sector average (37/100).
Adjacent peers: Mezo Borrow (B-, 33/100) is ranked just safer, and Reservoir Protocol (B-, 35/100) is ranked just riskier.
See the full CDP sector leaderboard or the Bucket Protocol V2 vs Reservoir Protocol comparison.
Common Questions about Bucket Protocol V2
Plain-English answers based on Bucket Protocol V2's scores across Hindenrank's 8 risk dimensions. The highest-scoring (riskiest) dimension is Vitality Risk (6/10).
Has Bucket Protocol V2 ever been hacked or exploited?
Bucket Protocol V2 has had some operational issues or moderate incidents in its history. The track record dimension scored 6/15 — not catastrophic, but enough to flag. Look at the specific events and whether they were addressed by the team before drawing conclusions.
How much money is at stake in Bucket Protocol V2?
Bucket Protocol V2 currently holds roughly $10M in user deposits. Smaller TVL means individual depositors carry a larger share of any loss event, and it can be harder to exit a position quickly during stress.
What's the worst-case scenario for Bucket Protocol V2?
Hindenrank has identified specific collapse scenarios for Bucket Protocol V2. The most prominent: "BUCK Depeg During SUI Market Crash". The trigger condition is SUI drops 40%+ rapidly, overwhelming the Tank stability pool. Reading through the full scenario list on the protocol page is the single best way to understand the actual failure modes — generic "smart contract risk" is rarely the thing that takes a protocol down.
Is Bucket Protocol V2 regulated or insured?
Bucket Protocol V2 has some regulatory exposure (5/10), typical of mid-sized DeFi protocols. There is no specific enforcement action on record, but the structure includes elements that regulators have flagged in similar protocols. No DeFi protocol carries FDIC-style insurance — even with low regulatory risk, depositors are not protected in the way bank customers are.
What are the biggest red flags for Bucket Protocol V2?
Hindenrank's retail-focused risk audit flagged: If SUI price drops sharply, your collateral could be liquidated BUCK depends on multiple stability mechanisms that could fail during extreme conditions Sui ecosystem is young, limiting where you can use BUCK
Should beginners deposit into Bucket Protocol V2?
Bucket Protocol V2 is rated B-, which is acceptable for users who understand the protocol's mechanism. Beginners should read the full risk breakdown and only deposit after they can articulate the top three failure modes. If you cannot explain how the protocol works, do not deposit.
How does Bucket Protocol V2 compare to safer CDP alternatives?
Bucket Protocol V2 is one protocol in Hindenrank's CDP coverage. The safest CDP protocols on the leaderboard tend to share three traits: a long incident-free track record, conservative mechanism design, and high-quality public documentation. Compare Bucket Protocol V2 against the full CDP ranking before committing capital.
For the full 8-dimension score breakdown, the radar chart, and dependency graph, see the Bucket Protocol V2 risk report.
Read the Full Bucket Protocol V2 Risk Report
This protocol has 2 collapse scenarios. 2 high-severity interaction risks identified. See the full mechanism classification, interaction matrix, and deep-dive recommendations.
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