CavalRe AMM

Smart Contract Security Assessment

October 16, 2023

SUMMARY​

ABSTRACT​

Dedaub was commissioned to audit the CavalRe protocol implementation, located at the repository https://github.com/CavalRe/multiswap, commit hash 19dbcf2a3a11797bd7e7bf2f9bce2d0dd4bc6abe. The audit focuses on changes carried out since Dedaub’s last audit of the protocol, dated August 2023, which can be found here . Since the previous audit the Users.sol contract has been significantly simplified. The contract now only keeps track of whether a user is blocked, as well as the discount that the user can receive. The system of affiliates allowing multiple addresses to be connected to the same CavalRe account has been removed. The LPToken.sol contract has also been modified to reflect the changes in Users.sol. The concept of one CavalRe transaction per block has been done away with. A two-step design to bypass the need for approving funds to the contract has also been added to Pool.sol.

SETTING AND CAVEATS​

The audit scope consists of the following files:

Two auditors worked on the code for 2 days.

The audit’s main target is security threats, i.e., what the community understanding would likely call "hacking", rather than regular use of the protocol. Functional correctness (i.e., issues in "regular use") is a secondary consideration. Functional correctness of most aspects (e.g., relative to low-level calculations, including units, scaling, quantities returned from external protocols) is generally most effectively done through thorough testing rather than human auditing. Importantly, thorough integration testing in the setting of final use is also an aspect that is not effectively covered by human auditing and remains the responsibility of the development team.

PROTOCOL-LEVEL CONSIDERATIONS​

VULNERABILITIES & FUNCTIONAL ISSUES​

This section details issues that affect the functionality of the contracts. Dedaub generally categorizes issues according to the following severities, but may also take other considerations into account such as impact or difficulty in exploitation:

Issue resolution includes “dismissed” or “acknowledged” but no action taken, by the client, or “resolved”, per the auditors.

CRITICAL SEVERITY​

for (uint256 i; i < payTokens.length; i++) {
            address payToken = payTokens[i];
            uint256 amount = amounts[i];
            if (payToken == address(this)) {
                uint256 contractBalance = balanceOf(address(this));
                if (contractBalance == 0) {
                    _burn(sender, amount);
                } else if (contractBalance < amount) {
                    _burn(sender, amount - contractBalance);
                    _burn(address(this), contractBalance);
                }//Dedaub: the case contractBalance >= amount, i.e. the //user has sent more than needed for the multiswap LP tokens, is not //covered. If this happens, the LP tokens sent to the Pool are not burnt!!
            } else {
               .. .
        }

HIGH SEVERITY​

[NO HIGH SEVERITY ISSUES]

MEDIUM SEVERITY​

[NO MEDIUM SEVERITY ISSUES]

LOW SEVERITY​

CENTRALIZATION ISSUES​

It is often desirable for DeFi protocols to assume no trust in a central authority, including the protocol’s owner. Even if the owner is reputable, users are more likely to engage with a protocol that guarantees no catastrophic failure even in the case the owner gets hacked/compromised. We list issues of this kind below. (These issues should be considered in the context of usage/deployment, as they are not uncommon. Several high-profile, high-value protocols have significant centralization threats.)

[NO CENTRALISATION ISSUES]

OTHER/ ADVISORY ISSUES​

This section details issues that are not thought to directly affect the functionality of the project, but we recommend considering them.

DISCLAIMER​

The audited contracts have been analyzed using automated techniques and extensive human inspection in accordance with state-of-the-art practices as of the date of this report. The audit makes no statements or warranties on the security of the code. On its own, it cannot be considered a sufficient assessment of the correctness of the contract. While we have conducted an analysis to the best of our ability, it is our recommendation for high-value contracts to commission several independent audits, a public bug bounty program, as well as continuous security auditing and monitoring through Dedaub Security Suite.

ABOUT DEDAUB​

Dedaub offers significant security expertise combined with cutting-edge program analysis technology to secure some of the most prominent protocols in DeFi. The founders, as well as many of Dedaub's auditors, have a strong academic research background together with a real-world hacker mentality to secure code. Protocol blockchain developers hire us for our foundational analysis tools and deep expertise in program analysis, reverse engineering, DeFi exploits, cryptography and financial mathematics.