Attacker can trigger permanent lock of funds of normal traders

Summary

An attacker can buy bull positions using a custom contract with onERC721Received callback and transfer his position to a zero address on the settlement or reclaiming. This makes that order still matchable because it passes the checkIsValidOrder. This can lead to potential loss for the order maker and the future taker, and their funds will be locked in the protocol.

Vulnerability Detail

The protocol uses safeTransferFrom to send NFTs to the bull and it is possible for the bull to do additional things in the IERC721Receiver.onERC721Received callback. Although the major functions are written as nonReentrant, there are still public functions that can be called from the callback and it is possible for an attacker to manipulate the protocol storage.

The scenario would be:

An attacker buys a position using a contract that implemented IERC721Receiver and in the onERC721Received function makes a call to transferPosition with recipient=0.
If that order is settled, settledContracts[contractId] is set to true and bulls[contractId] = address(0) (because of the callback).
If that order is reclaimed, reclaimedContracts[contractId] is set to true and bulls[contractId] = address(0) (because of the callback).

Note that the attacker set bulls[contractId] = address(0). This makes it possible for a future taker to match that order again because checkIsValidOrder function does not check settledContracts or reclaimedContracts but only bulls[uint(orderHash)] == address(0). But that order was already settled or reclaimed and none of the taker or the maker can claim their funds back.

Of course this is only possible if the order maker didn't change the nounce yet and approves the new order match but it is very likely for normal traders to approve the protocol for transfering funds with a belief that the order will be verified.

Impact

A sophisticated attacker can exploit using the ERC721 callback and make \<invalid> orders with abnormal status. Because the trader's funds can be locked in the protocol permanently, I rate the impact as high.