> For the complete documentation index, see [llms.txt](https://yuzu-money.gitbook.io/yuzu-money/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://yuzu-money.gitbook.io/yuzu-money/faq/fundamental-oracles.md).

# Fundamental Oracles

A fundamental oracle prices an asset based on its *intrinsic value* (its NAV redemption value, what it can actually be redeemed for) rather than its *market price* on a DEX. For example, syrupUSDT can always be redeemed for USDT at NAV, even if a thin DEX shows it temporarily trading at $0.98.

#### **Why this matters**

Most DeFi liquidations are triggered by short-term market price moves on lending platforms. Fundamental oracles eliminate that risk because the oracle reports the asset's redemption value, not the volatile market quote. A leveraged position priced with a fundamental oracle can only be liquidated if the underlying yield economics genuinely break down — not because of a brief market dislocation.

Yuzu uses fundamental oracles wherever possible for leveraged positions, removing market-driven liquidation risk from the strategy.

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