# Overview

Code 432n4 (C4) is an open organization consisting of security researchers, auditors, developers, and individuals with domain expertise in smart contracts.

A C4 code contest is an event in which community participants, referred to as Wardens, review, audit, or analyze smart contract logic in exchange for a bounty provided by sponsoring projects.

During the code contest outlined in this document, C4 conducted an analysis of the bveCVX smart contract system written in Solidity. The code contest took place between September 2—September 8 2021.

## Wardens

7 Wardens contributed reports to the bveCVX by BadgerDAO code contest:

This contest was judged by ghoul.sol.

Final report assembled by moneylegobatman and CloudEllie.

# Summary

The C4 analysis yielded an aggregated total of 21 unique vulnerabilities and 51 total findings. All of the issues presented here are linked back to their original submission.

Of these findings, 1 received a risk rating in the category of HIGH severity, 2 received a risk rating in the category of MEDIUM severity, and 18 received a risk rating in the category of LOW severity.

C4 analysis also identified 13 non-critical recommendations and 17 gas optimizations.

# Scope

The code under review can be found within the C4 bveCVX code contest repository is composed of 219 smart contracts written in the Solidity programming language and includes 21,403 lines of Solidity code.

# Severity Criteria

C4 assesses the severity of disclosed vulnerabilities according to a methodology based on OWASP standards.

Vulnerabilities are divided into three primary risk categories: high, medium, and low.

High-level considerations for vulnerabilities span the following key areas when conducting assessments:

• Malicious Input Handling
• Escalation of privileges
• Arithmetic
• Gas use

Further information regarding the severity criteria referenced throughout the submission review process, please refer to the documentation provided on the C4 website.

# High Risk Findings (1)

## [H-01] veCVXStrategy.manualRebalance has wrong logic

Submitted by cmichel, also found by tabish

The veCVXStrategy.manualRebalance function computes two ratios currentLockRatio and newLockRatio and compares them.

However, these ratios compute different things and are not comparable:

• currentLockRatio = balanceInLock.mul(10**18).div(totalCVXBalance) is a percentage value with 18 decimals (i.e. 1e18 = 100%). Its max value can at most be 1e18.
• newLockRatio = totalCVXBalance.mul(toLock).div(MAX_BPS) is a CVX token amount. It’s unbounded and just depends on the totalCVXBalance amount.

The comparison that follows does not make sense:

if (newLockRatio <= currentLockRatio) {
// ...
}

#### Impact

The rebalancing is broken and does not correctly rebalance. It usually leads to locking nearly everything if totalCVXBalance is high.

Judging from the cvxToLock = newLockRatio.sub(currentLockRatio) it seems the desired computation is that the “ratios” should actually be in CVX amounts and not in percentages. Therefore, currentLockRatio should just be balanceInLock. (The variables should be renamed as they aren’t really ratios but absolute CVX balance amounts.)

Agree with the finding, the math is wrong

We will mitigate by deleting the function and using manualRebalance and manualSendbCVXToVault as way to manually rebalance

We mitigated by rewriting the code for manualRebalance

# Medium Risk Findings (2)

## [M-01] SettV3.transferFrom block lock can be circumvented

Submitted by cmichel

The SettV3.transferFrom implements a _blockLocked call to prevent users to call several functions at once, for example, deposit and then transferring the tokens.

function _blockLocked() internal view {
require(blockLock[msg.sender] < block.number, "blockLocked");
}

However, as the block lock only checks msg.sender, an attacker can circumvent it using transferFrom:

• Attacker owns accounts A, B and C
• A deposits, _lockForBlock(msg.sender) = _lockForBlock(A) is called and A is locked.
• A approves B.
• B calls transferFrom(from=A, to=C, amount). This passes the _blockLocked() = _blockLocked(B) check.
• C calls withdraw().

#### Impact

The protection desired from the _blockLocked call does not work for this function. I assume the call is used to prevent flashloan attacks, but an attacker can bypass the protection on transferFrom.

The block lock should be on the account that holds the tokens, i.e., on sender (“from” address), not on msg.sender. Parameterize _blockLocked to take an account parameter instead.

The finding is correct, blockLock is ineffective

The Recommended MItigation Steps proposes a DOS vector (I’ll deposit 1 wei for you so you don’t get to withdraw your funds)

## [M-02] CvxLocker.setBoost wrong validation

Submitted by cmichel

The CvxLocker.setBoost function does not validate the _max, _rate parameters, instead it validates the already set storage variables.

// @audit this is checking the already-set storage variables, not the parameters
require(maximumBoostPayment < 1500, "over max payment"); //max 15%
require(boostRate < 30000, "over max rate"); //max 3x

#### Impact

Once wrong boost values are set (which are not validated when they are set), they cannot be set to new values anymore, breaking core contract functionality.

require(_max < 1500, "over max payment"); //max 15%
require(_rate < 30000, "over max rate"); //max 3x

This can be an issue as our strat takes those variables at face value

As Badger we ended up upgrading the strategy to check for the validity of the inputs

for convex side, we can layer on an admin contract that has the correct checks

# Low Risk Findings (19)

Submitted by JMukesh

#### Impact

parameter used in constructor and initilizer are used to initialize the state variable, error in these can lead to redeployment of contract

#### Tools Used

manual review

add address(0) validation

Agree on the issue and severity To be fair if we put a wrong value we just redeploy

## [L-02] CvxLocker.setStakeLimits missing validation

Submitted by cmichel

The CvxLocker.setStakeLimits function does not check _minimum <= _maximum.

require(_minimum <= _maximum, "min range");
require(_maximum <= denominator, "max range");

will add an extra layer to call admin functions with fixed checks

## [L-03] CvxLocker.setApprovals can be called by anyone

Submitted by cmichel

The CvxLocker.setApprovals function is callable by anyone, not only by the owner/admin.

#### Impact

It’s okay for this function to be callable by anyone.

Remove the comment that these are admin-only functions (ADMIN CONFIGURATION section) as this is not true for setApprovals and one does not know if it’s intended to be admin-only or not.

## [L-04] CvxLocker.findEpochId stops after 128 iterations

Submitted by cmichel

It’s unclear why the binary search algorithm stops after 128 iterations.

#### Impact

It might not return the actual epoch id (although very unlikely as 128 iterations should be sufficient.)

Use a while (max > min) loop instead of the for loop with a fixed number of iterations.

uint256 mid = (min + max + 1) / 2; is also not using safe math.

## [L-05] Unbounded iteration in CvxLocker.updateReward

Submitted by cmichel

The CvxLocker.updateReward iterates over all rewardTokens.

#### Impact

The transactions can fail if the arrays get too big and the transaction would consume more gas than the block limit. This will then result in a denial of service for the desired functionality and break core functionality.

Keep the number of rewardTokens small.

## [L-06] Missing slippage/min-return check in veCVXStrategy

Submitted by cmichel, also found by tabish

The contracts are missing slippage checks which can lead to being vulnerable to sandwich attacks.

See veCVXStrategy._swapcvxCRVToWant:

IUniswapRouterV2(SUSHI_ROUTER).swapExactTokensForTokens(
toSwap,
0, // @audit min. return of zero, no slippage check
path,
now
);

#### Impact

Trades can happen at a bad price and lead to receiving fewer tokens than at a fair market price. The attacker’s profit is the protocol’s loss.

Accept a function parameter that can be chosen by the transaction sender, then check that the actually received amount is above this parameter.

Alternatively, check if it’s feasible to send these transactions directly to a miner such that they are not visible in the public mempool.

Not sure if this would be Medium in other bug bounties That said, yeah we use Flashbots to avoid being frontrun and yes the 0 for minOut can cause problems

ghoul-sol (judge) commented:

## [L-07] Missing slippage/min-return check in StrategyCvxHelper

Submitted by cmichel

The contracts are missing slippage checks which can lead to being vulnerable to sandwich attacks.

See StrategyCvxHelper.harvest:

_swapExactTokensForTokens(sushiswap, cvxCrv, cvxCrvBalance, getTokenSwapPath(cvxCrv, cvx));
// @audit calls UniSwapper._swapExactTokensForTokens:
IUniswapRouterV2(router).swapExactTokensForTokens(balance, 0 /* zero min return */, path, address(this), now);

#### Impact

Trades can happen at a bad price and lead to receiving fewer tokens than at a fair market price. The attacker’s profit is the protocol’s loss.

Add minimum return amount checks. Accept a function parameter that can be chosen by the transaction sender, then check that the actually received amount is above this parameter.

Alternatively, check if it’s feasible to send these transactions directly to a miner such that they are not visible in the public mempool.

Same as #57

ghoul-sol (judge) commented:

Exactly the same problem reported but in a different place of the code. I’ll keep it.

## [L-08] Missing slippage/min-return check in BaseStrategy

Submitted by cmichel

The contracts are missing slippage checks which can lead to being vulnerable to sandwich attacks.

See BaseStrategy._swap:

IUniswapRouterV2(uniswap).swapExactTokensForTokens(balance, 0 /* zero min return */,path, address(this), now);

#### Impact

Trades can happen at a bad price and lead to receiving fewer tokens than at a fair market price. The attacker’s profit is the protocol’s loss.

Add minimum return amount checks. Accept a function parameter that can be chosen by the transaction sender, then check that the actually received amount is above this parameter.

Alternatively, check if it’s feasible to send these transactions directly to a miner such that they are not visible in the public mempool.

Same as #56

ghoul-sol (judge) commented:

Same issue, different place. Keeping as is with low risk.

## [L-09] StrategyCvxHelper: safeApprove instead of approve

Submitted by hickuphh3

This was probably an oversight since

• the veCVXStrategy contract used safeApprove() for token approvals
• using SafeERC20Upgradeable for IERC20Upgradeable; was declared

Change

cvxToken.approve(address(cvxRewardsPool), MAX_UINT_256);

to

cvxToken.safeApprove(address(cvxRewardsPool), MAX_UINT_256);

Agree with finding

We ended up using safeApprove as suggested

## [L-10] Swap conversion is susceptible to MEV flashbots

Submitted by hickuphh3

##### Impact

In veCVXStrategy, the cvxCRV -> ETH -> CVX conversion via sushiswap is done with 0 minAmountOut, making it susceptible to sandwich attacks / MEV flashbots. This is also true for UniSwapper inherited by StrategyCvxHelper.

1. veCVXStrategy

Ideally, the harvest() function should take in a minAmountOut parameter, but this breaks the Yearn architecture used. Using TWAPs / price oracles might alleviate the problem, but results in higher gas usage, and with multiple hops involved, may not be feasible.

A simpler approach would be to have a configurable storage variable minAmountOut. Its value can then be adjusted such that harvesting can be done infrequently to save gas.

2. UniSwapper

Ideally, each path registered in the TokenSwapPathRegistry should also have a minAmount mapping, that can be fetched together with the path.

Agree with finding, we use private txs for harvests

## [L-11] veCVXStrategy: Sub-optimal trading path

Submitted by hickuphh3

##### Impact

_swapcvxCRVToWant() swaps cvxCRV -> ETH -> CVX via sushiswap.

Looking at sushiswap analytics, this may also not be the most optimal trading path. The cvxCRV-CRV pool seems to have substantially better liquidity than the cvxCRV-ETH pool as reported here (Note that cvxCRV-CRV’s liquidity is overstated, clicking into the pool gives a more reasonable amount). It is therefore better to do cvxCRV -> CRV -> ETH -> CVX, though this comes at the cost of higher gas usage.

Switch the trading path to cvxCRV -> CRV -> ETH -> CVX, as it means more CVX tokens received, translating to higher APY, while the higher gas cost is borne by the caller.

Additionally, given how liquidity can shift between pools over time, the most optimal trade path may change accordingly. Hence, it may be beneficial to make the pool path configurable.

I love that you caught this Yeah we ended up using curve

## [L-12] Functions not returning declared values

Submitted by pauliax

#### Impact

function withdrawAll in BaseStrategy declares ‘returns (uint256 balance)’, however, no actual value is returned. function reinvest in MyStrategy declares to return ‘uint256 reinvested’, however, it also actually does not return anything so they always get assigned a default value of 0.

Either remove the return declarations or return the intended values. Otherwise, it may confuse other protocols that later may want to integrate with you.

We should remove the return values

## [L-13] Frontrunning distribute functions

Submitted by pauliax

#### Impact

distribute and distributeOther can be frontrunned. Anyone can call these functions and receive callIncentive. A frontrunner can watch the mempool and copy the calldata to replicate the same tx. For example, a frontrunner calculates that replicating this tx will result in profit, he watches and copies the tx, then instantly sell these received incentives on AMM for profit. This may result in reverted txs, gas wasted, and a poor experience for legit users.

This problem seems insurmountable in this case but you may want to consider adding restrictions on the callers or introducing any other possible prevention techniques.

## [L-14] Faulty return value in veCVXStrategy::reinvest()

Submitted by pmerkleplant, also found by tabish

#### Impact

The function reinvest in the veCVXStrategy always returns 0 as the return variable reinvested is never updated. The function is onlyGovernance and the return value probably does not matter if the caller is a multi-sig. However, if a protocol is set as onlyGovernance the faulty return value would have to be ignored by the caller to not transition into an incorrect state.

#### Proof of Concept

The variable reinvested is declared as return variable (line 400) but not updated to reflect the actual amount reinvested which is saved in variable toDeposit.

Therefore always the default value is returned (0).

Add reinvested = toDeposit; after line 412.

Agreed, we should just delete the return value as we don’t need it

## [L-15] setKeepReward function is unfinished

#### Impact

The setKeepReward function is unfinished.

#### Proof of Concept

veCVXStrategy.sol L203

Either complete the function or follow the comment above the code and remove it.

Agree, should delete

## [L-16] Don’t include unused functions

#### Impact

The code includes unused functions, like tend(), L319. It’s best practice to remove these. It will also save gas.

Remove the unused function.

Agree

## [L-17] Reentrancy on distributeOther()

#### Impact

The distribute function can be re-entered by fake tokens or tokens with callbacks. An attacker can use the callbacks on safeTransfer if a token has a callback to reenter an drain the entire balance of that particular token before the notifyRewardAmount is called.

I think this is only a medium issue because the attacker can only take tokens with callbacks, and I don’t think any of the tokens you guys use have callbacks.

#### Proof of Concept

CvxStakingProxy.sol L153

Be aware of this possibility. If you really want to, add a nonReentrant modifier to the function.

Not my issue to handle, but should be low because it’s dependent on the token, also you already know cvxCRV and CVX are ERC20 and don’t have custom hooks on transfer

ghoul-sol (judge) commented:

as per warden description this is unlikely to happen so making this low risk

## [L-18] ManualRebalance will be frontrun for most of the tokens.

#### Impact

We have previously seen that the harvest function can be exploited for almost all the tokens at stake. Since ManualRebalance calls harvest, it is also unsafe and funds swapped using it will likely be lost.

#### Proof of Concept

sol#L444 L453

Adding an amount out minimum here will work that should be passed on to the harvest method.

Disagree with risk (should be medium like all other harvest findings), also we have optional harvest which means we can skip it, hence the finding is deceiving at best

We use private txs to mitigate

ghoul-sol (judge) commented:

similar to #55 #56 and other front-running issues in this contest, it’s low risk given the sponsor comments.

# Disclosures

C4 is an open organization governed by participants in the community.

C4 Contests incentivize the discovery of exploits, vulnerabilities, and bugs in smart contracts. Security researchers are rewarded at an increasing rate for finding higher-risk issues. Contest submissions are judged by a knowledgeable security researcher and solidity developer and disclosed to sponsoring developers. C4 does not conduct formal verification regarding the provided code but instead provides final verification.

C4 does not provide any guarantee or warranty regarding the security of this project. All smart contract software should be used at the sole risk and responsibility of users.