# Risk Methodology

In addition to the Mandatory Whitelisting criteria, there are three different risk categories that are critical in assessing whether a token would be allowed as collateral on the 3A protocol:

Each risk category must score a minimum of 50 to be considered by the 3A DAO:

* ***Fundamental Risk Score*** enables a comprehensive evaluation of the overall quality of the protocol and uncovers potential design risks.
* ***Technical Risk Score*** indicates how closely projects follow best practices in terms of process quality and cybersecurity. Evaluate the documentation and stress tests and verify the audit reports.
* ***Market Risk Score*** quantifies the exogenous risks that occur when crypto markets are volatile and cause the collateral assets to fluctuate a lot.

The risk category assessments are carried out by the 3A contributors using community templates and feedback and approved by the 3A DAO managing members.

For digital assets that have been trading since November 2021 or longer, only the Marker Risk Score is assessed. It's assumed that assets that survived the last bear market can be treated as commodities on their own rights.&#x20;

Additionally, when assessing tokenized real-world assets, the risk of the underlying asset will be assessed.&#x20;


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