0x73696d616f - `rewardData.releaseRate` is incorrectly calculated on `RewardsController::config()` when `block.timestamp > start` and `rewardData.lastConfig != rewardData.start`

[sherlock-admin3]

0x73696d616f

high

rewardData.releaseRate is incorrectly calculated on RewardsController::config() when block.timestamp > start and rewardData.lastConfig != rewardData.start

Summary

Setting new parameters in RewardsController::config() will lead to lost rewards if block.timestamp > start and the rewardData.start was set in the future initially.

Vulnerability Detail

When RewardsController::config() is called to update the data of a reward, as it was already set initially, it will go into the else branch. In here, it updates the rewardRate according to the previously distributed rewards, the total distribution and the distribution periods. More precisely, the calculation is:

...
if (block.timestamp > start) {
  released =
    rewardData.lastConfigReleased +
    rewardData.releaseRate *
    (block.timestamp - rewardData.lastConfig);
  elapsed = block.timestamp - start;
  if (configs[i].totalDistribution <= released || configs[i].distributionPeriod <= elapsed) {
    revert InvalidConfig();
  }
  rewardData.lastConfigReleased = released;
}

rewardData.releaseRate =
  (configs[i].totalDistribution - released) /
  (configs[i].distributionPeriod - elapsed);
...

It calculates the release pro-rata to block.timestamp - rewardData.lastConfig, considering the time that the rewards have been emitted, but this is incorrect when rewardData.start was set in the future when creating the initial config. This will lead to the overestimation of released rewards, which will lower the rewardData.releaseRate, as it is pro-rata to configs[i].totalDistribution - released. Thus, less rewards will be distributed than expected.

Impact

Lost of rewards for users that will receive less than supposed.

Code Snippet

https://github.com/sherlock-audit/2024-04-interest-rate-model/blob/main/protocol/contracts/RewardsController.sol#L681 https://github.com/sherlock-audit/2024-04-interest-rate-model/blob/main/protocol/contracts/RewardsController.sol#L699

Tool used

Manual Review

Vscode

Recommendation

The release rewards are rewardData.releaseRate * (block.timestamp - rewardData.start);.

[sherlock-admin2]

The protocol team fixed this issue in the following PRs/commits: https://github.com/exactly/protocol/pull/725

[sherlock-admin2]

The Lead Senior Watson signed off on the fix.