Open c4-bot-6 opened 10 months ago
hansfriese marked the issue as primary issue
fez-init (sponsor) disputed
I think this is a duplicate of #25
from #25
It should be noted that most DEXs (e.g., Uniswap) allow any user to provide liquidity to any other users position. In practice, this bypasses the collateralization paused functionality.
from this report
the user can increase the liquidity worth unlimitedly by calling the function increaseLiquidity
This issue is more of a recommendation to check supply cap on wLps, but this seems invalid since LendingPool does not support LP tokens, as LP tokens will be within wLps.
Although this issue also talks about being able to increase wLp infinitely, this issue is different from #25 . #25 is talking breaking the intended behavior when collateralization is supposedly paused and is able to be bypassed. @JeffCX
I agree it's different from #25. Downgrade to QA as it shows a lower impact.
hansfriese changed the severity to QA (Quality Assurance)
hansfriese marked the issue as grade-a
Lines of code
https://github.com/code-423n4/2023-12-initcapital/blob/a53e401529451b208095b3af11862984d0b32177/contracts/core/InitCore.sol#L107
Vulnerability details
Impact
Use WLP as collateral can bypass the supply cap check for underlying asset exposure
Proof of Concept
User can deposit asset into the lending pool and then mint lending pool and then use lending pool share as collateral to borrow fund
User can also mint WLP and use WLP as collateral to borrow
when the lending pool share is minted, the total asset is subject to the supply cap check
note the check
the intention is to limit the underlying exposure of a underlying asset in lending pool
However, there is no such as check when user collateralize the position via WLP
the protocol intends to support AMM LP as highlight in the white paper
for example,
if the LP token is Uniswap V3 LP
after the LP becomes WLP as collateral,
the user can increase the liquidity worth unlimitedly by calling the function increaseLiquidity , even after collateralizeWLP to bypass the supply cap
https://docs.uniswap.org/contracts/v3/reference/periphery/NonfungiblePositionManager#increaseliquidity
Tools Used
Manual Review
Recommended Mitigation Steps
When user collateralize using WLP, check supply cap as well
Assessed type
Token-Transfer