This is the link describing the reserve from the white paper:https://gmd-protocol.gitbook.io/gmd-protocol/gmd-delta-neutral-strategy/protocols-glp-reserve-the-reserve
I can't copy and paste the content. However, the reserve is funded 100% by the team.
Any time you invest in a crypto project, you are assuming risk. I can't read code and audits have existed on many exploited or rugged projects.
However, the team seems to have a good model and they can earn much greater returns by making a solid, profitable protocol than ripping people off.
We are talking about an Arbitrum project here, not a BSC project. Investors tend to do more due dilligence on Arbitrum than BSC. However, you raise good points that should be considered.
Thank you for sharing your thoughts. Hopefully, the decsription does a better job explaining the reserve.