Glamorous Plum Baboon
High
Summary:
The Pool contract exposes a potential reentrancy vulnerability in the functions withdraw, borrow, and repayWithATokens. These functions interact with external contracts, and if any of these external calls reenter the Pool contract, it could lead to inconsistent contract states. Implementing reentrancy protection is recommended to mitigate this risk.
Description:
The withdraw, borrow, and repayWithATokens functions in the Pool contract perform operations that involve external contract calls, such as token transfers or interactions with other decentralized protocols. However, these functions lack proper reentrancy protection, allowing the possibility for malicious external contracts to re-enter the Pool contract, causing unintended changes to the contract's state.
This issue arises when the external call (e.g., token transfer) triggers a callback to the Pool contract, which may modify the state or trigger other actions before the initial transaction is fully processed, resulting in a reentrancy vulnerability.
Root Cause:
The core issue stems from the Pool contract's failure to protect against reentrancy in critical functions. Specifically, functions such as withdraw, borrow, and repayWithATokens change the contract's state before performing external calls. This can create an opening for malicious contracts to exploit the lack of protection by reentering the contract during these external calls.
The vulnerable Lines of Code (LoC) are in the following sections:
- withdraw function: State change occurs before external call to token transfer.
- borrow function: State change occurs before external call to transfer tokens.
- repayWithATokens function: State change occurs before external contract interaction.
Impact:
Without proper reentrancy protection, an attacker can exploit the vulnerability to:
- Drain funds: Re-entering the contract during state changes could allow attackers to withdraw or borrow more tokens than intended.
- State inconsistencies: Reentrancy could cause the contract to operate on outdated or inconsistent state data, leading to logic errors and potentially corrupting the pool's integrity.
- Loss of funds: Users could unknowingly lose their funds due to improper handling of state changes.
In the worst case, this vulnerability could lead to the complete loss of the contract’s funds or assets, potentially affecting all participants.
POC (Proof of Concept):
The following is a simplified example of how an attacker could exploit the reentrancy issue. This assumes the attacker creates a malicious contract that calls back into the Pool contract’s withdraw function during the execution of the external token transfer:
- The attacker initiates a withdrawal from the Pool contract, triggering the
withdrawfunction. - During the external token transfer, the attacker’s malicious contract triggers a callback to the
withdrawfunction before the initial transaction is complete. - This reentrancy allows the attacker to withdraw more tokens than intended, as the state change for the initial withdrawal has not been processed yet.
Recommended Mitigation:
To mitigate this risk, we recommend implementing reentrancy protection in the affected functions. Specifically, integrating a reentrancy guard mechanism will prevent malicious contracts from making reentrant calls to the Pool contract.
Actionable steps:
-
Use OpenZeppelin's
ReentrancyGuard:
Add theReentrancyGuardmodifier from OpenZeppelin's contract library to each of the state-changing functions that interact with external contracts (withdraw,borrow,repayWithATokens). -
State changes after external calls:
Another approach is to ensure that all external calls (e.g., token transfers) happen after the state changes are made. This reduces the chance of a malicious contract reentering and manipulating the contract's state.
By taking these actions, the Pool contract will be secured against reentrancy attacks and provide better safety to its users and funds.