DeFi composability introduces security vulnerabilities, dependency risks, regulatory uncertainty, and potential system failures, necessitating stringent security measures and regulatory frameworks for sustainable growth.

Security flaws arising from protocol interconnectivity are one of the primary concerns. Interactions between protocols or smart contracts can create complex attack surfaces, exposing weaknesses across the entire ecosystem.

Dependency risks also include the failure or compromise of underlying protocols, which may trigger a chain reaction affecting other protocols and user funds. Due to the dynamic nature of DeFi, regulatory and compliance issues may pose legal hurdles.

Furthermore, the pace of innovation enabled by composability could lead to hastily integrated systems or insufficiently tested protocols, increasing the likelihood of bugs, exploits, or systemic failures.

Robust security protocols, extensive audits, standardization initiatives, and evolving regulatory frameworks are needed to address these challenges and ensure the safety and long-term growth of the DeFi ecosystem.