# 7.2 Market Risk Management

* **Response to Extreme Market Conditions:**&#x57;hen Bitcoin drops more than 30% in a single day, the protocol automatically triggers the following protective mechanisms:
  * Leverage in High-Growth Tier is forcibly reduced to 1x
  * RWA allocation in the Balanced Tier is increased to 90%
  * New fund subscriptions are paused for 24 hours to protect existing users
* **Liquidity Risk Control:**&#x41; three-tiered liquidity buffer system is established:
  * **Tier 1:** Stablecoin reserve (covers 10% of total pool size)
  * **Tier 2:** Highly liquid DeFi assets (covers 20%)
  * **Tier 3:** RWA-backed lending (covers 30%)
