Carrot Liquidity

Carrot Liquidity receives a C risk grade (43/100) from Hindenrank, where lower scores indicate lower risk. SHUT DOWN — Protocol wind-down functionally complete as of late May 2026. ~$8M in realized losses from the Drift Protocol exploit (April 1, 2026). Drift rebranded to Velocity DEX (July 1, 2026) with Tether's $127.5M commitment confirmed; private beta launched. DFX recovery token claim checker live (view-only) but pool remains below $5M early-redemption threshold as of July 1-2, 2026. Critical complication: the Drift exploiter (attributed to DPRK/Lazarus Group) laundered $44.4M ETH through Tornado Cash on July 23-24, 2026, materially reducing direct fund recovery probability. Full recovery for Carrot CRT holders remains contingent on Velocity DEX generating sufficient trading revenue to fund the $150M recovery pool. Carrot Liquidity is a Solana yield aggregator that automatically routed stablecoin deposits across lending platforms. The protocol shut down after suffering approximately $8M in losses from the Drift Protocol exploit (April 1, 2026). The May 14, 2026 withdrawal deadline has passed and wind-down is functionally complete.

The key risks identified for Carrot Liquidity are: (1) PROTOCOL SHUT DOWN: Wind-down is functionally complete with TVL at ~$2K. Any remaining CRT holders should contact the Carrot team immediately. Drift rebranded to Velocity DEX (July 1, 2026) — recovery via DFX tokens is possible but pool remains below the $5M early-redemption threshold and the exploiter laundered $44.4M through Tornado Cash on July 23-24, 2026. (2) Inherited protocol risks materialized: Carrot's exposure to Drift Protocol's lending markets resulted in approximately $8M in losses when Drift was exploited on April 1, 2026 — demonstrating how routing funds across multiple protocols aggregates third-party risk. (3) No revenue model: Carrot charged zero management fees, which contributed to the decision to shut down once losses reduced TVL to an economically unviable level.

Carrot Liquidity scores 43/100 across eight risk dimensions: Mechanism Novelty: 3/15, Interaction Severity: 9/20, Oracle Surface: 0/10, Documentation Gaps: 2/10, Track Record: 15/15, Scale Exposure: 0/10, Regulatory Risk: 4/10, Vitality Risk: 10/10. The highest risk area is Track Record at 15/15.

Among 121 rated Yield protocols on Hindenrank, Carrot Liquidity ranks #90 by safety (lowest risk score = safest). Its 43/100 risk score and C grade place it among the riskier Yield protocols.

Carrot Liquidity scores 15/15 on the Track Record risk dimension, indicating some history of security incidents or exploits. Higher scores reflect more severe or frequent incidents. Review the full risk report for details.