Pool Coin Decimal Truncation During Deposit - Githubissues

tendermint / liquidity

Cosmos SDK Liquidity module

Apache License 2.0

135 stars 55 forks source link

Pool Coin Decimal Truncation During Deposit #445

Closed dongsam closed 2 years ago

dongsam commented 2 years ago

Summary of Bug

when the unit size of the pool coin is significantly large
when user deposits relatively small amount of coin into the liquidity pool

Version

Including v1.4.0, past versions.

Steps to Reproduce

Example

pool created with unit coin value $10
user deposits $19 amount of liquidity into the created pool
user's share should be 1.9 unit pool coin, but because of decimal truncation, user gets only 1 unit pool coin
user lost $9 amount of deposited coin because 1 unit pool coin value is only $10

Why It Happened?

reason why some of the pool unit coins have significantly large USD value?
- because some of the pools were created with a large initial deposit
  - first depositor always get 1,000,000 pool unit coin
  - if the initial deposit is larger than $1M, then the pool unit coin will be larger than $1
we expected this risk when we designed the spec
but we couldn't forecast that actually, some users create pools with +$1M initial deposit

The pools that have these problems.

CRO · ATOM
- https://app.emeris.com/pool/9
IRIS · ATOM
- https://app.emeris.com/pool/8
REGEN · ATOM
- https://app.emeris.com/pool/6
Sentinel · ATOM
- https://app.emeris.com/pool/7
AKT · ATOM
- https://app.emeris.com/pool/5

Solution

Refund of Decimal Part of the Deposit

we can calculate "maximum integer unit pool coin receivable" for each deposit request
the module receives the exact number of deposit coins with respect to the calculated number of unit pool coins, and the rest are refunded
with the refund feature, users are free from decimal truncation loss from receivable pool coin when they deposit liquidity

Patch Plan

we will steadily prepare this patch, accompanied with enough testing and simulation
if we can make time before Cosmos-SDK 0.44 upgrade, we will propose this into the upgrade
if we cannot make it, then this refund feature will be proposed to the next Gaia upgrade schedule

Param change

Apart from Patch, we plan to submit a parameter change proposal to increase the params.InitPoolCoinMintAmount to minimize this problem even if some users create pools with +$1M initial deposit in the future.

For Admin Use

[ ] Not duplicate issue
[ ] Appropriate labels applied
[ ] Appropriate contributors tagged
[ ] Contributor assigned/self-assigned