# Risks Anzen is committed to maintaining transparency. It's crucial to highlight the risks associated with USDz, the measures we have taken to mitigate these risks, and our ongoing risk management strategies, as well as any potential risks related to stablecoins in general. ## Risk of Synthetic Dollar * Custodial Risk * Exchange Failure Risk * Collateral Risk * Funding Risk * Liquidation Risk ## Risk of USDz as a RWA stablecoin Centralized stablecoins, such as *USDC*, *USDT*, and *USDz*, offer stability and capital efficiency, but they also introduce certain risks: * Carry an unhedgeable custodial risk with bond collateral in regulated bank accounts, which are susceptible to censorship. * Rely on the existing traditional market infrastructure and are affected by evolving country-specific regulations. * Users face a "return-free risk" as the issuer absorbs the yield while passing the risk of the depeg to users holding the fiat stablecoin. * Represent an unsecured credit position to both the issuer and the underlying bank holding the collateral assets, which are combined with other bank lending activities, such as those in Silicon Valley Bank. Any other centralized stablecoins that use "Real World Assets" (RWAs) as collateral and distribute the yield face the same risks of confiscation and censorship. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.anzen.finance/usdz-101/risks.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.