042.md

Low Tangerine Cod

High

Borrow's position will be never be liquidated after option expires

Summary

Borrows can renew their options, but option never expires, so liquidation will never occur

Root Cause

According to docs borrows should renew their options or it will be liquidated. In code their position will never be liquidated after 30 days.

Timestamp of 30 days will be added against every user in the backend for 30 days option maturity

Users will not pay revenue to protocol which they should by calling renewOptions every 30 days. Which means renewOptions will never be called

    function renewOptions(
        IBorrowing.Interfaces memory interfaces,
        uint64 index
    ) external returns (bool) {
        // calculate options fees needs to pay to renew
        uint256 optionsFeesNeedsToPay = getOptionFeesToPay(interfaces.treasury,index);

        // check whether the user has enough options fees to pay
        if (interfaces.usda.balanceOf(msg.sender) < optionsFeesNeedsToPay) revert IBorrowing.Borrow_InsufficientBalance();

        // transfer the options fees from user to treasury
->        bool sent = interfaces.usda.transferFrom(msg.sender, address(interfaces.treasury), optionsFeesNeedsToPay);

        if (!sent) revert IBorrowing.Borrow_USDaTransferFailed();

        // getting omnichain global data
        IGlobalVariables.OmniChainData memory omniChainData = interfaces.globalVariables.getOmniChainData();

        // updating last cumulative rate
        omniChainData.lastCumulativeRate = interfaces.cds.calculateCumulativeRate(uint128(optionsFeesNeedsToPay));
        omniChainData.totalCdsDepositedAmountWithOptionFees += optionsFeesNeedsToPay;

        // updating omnichain data
        interfaces.globalVariables.setOmniChainData(omniChainData);

        return true;
    }

Blockchain/Blockchian/contracts/lib/BorrowLib.sol#L627

Internal pre-conditions

none

External pre-conditions

none

Attack Path

none

Impact

Liquidation will not be happening for expired positions, protocol will lose that collateral which it should have. Protocol will not lose revenue via renewal which should be happening.

PoC

No response

Mitigation

Implement it

    function liquidateExpired(address user) public onlyAdmin{
    ...
        if(block.timestamp - depositDetail.optionsRenewedTimeStamp < 30 days) revert
    ...
    }