Mellow Protocol contest
Findings & Analysis Report


Table of contents


About C4

Code4rena (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 Mellow Protocol contest smart contract system written in Solidity. The code contest took place between December 2—December 8 2021.


17 Wardens contributed reports to the Mellow Protocol contest:

  1. WatchPug (jtp and ming)
  2. cmichel
  3. gzeon
  4. 0x1f8b
  5. 0x0x0x
  6. Meta0xNull
  7. robee
  8. pauliax
  9. cuong_qnom
  10. hagrid
  11. 0x421f
  12. defsec
  13. Jujic
  14. ye0lde
  15. pmerkleplant
  16. hyh

This contest was judged by 0xleastwood.

Final report assembled by itsmetechjay and CloudEllie.


The C4 analysis yielded an aggregated total of 23 unique vulnerabilities and 73 total findings. All of the issues presented here are linked back to their original finding.

Of these vulnerabilities, 4 received a risk rating in the category of HIGH severity, 7 received a risk rating in the category of MEDIUM severity, and 12 received a risk rating in the category of LOW severity.

C4 analysis also identified 11 non-critical recommendations and 39 gas optimizations.


The code under review can be found within the C4 Mellow Protocol contest repository, and is composed of 80 smart contracts written in the Solidity programming language and includes 5400 lines of Solidity code and 3 lines of JavaScript.

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 (4)

[H-01] YearnVault.sol#pull() will most certainly fail

Submitted by WatchPug

    for (uint256 i = 0; i < _yTokens.length; i++) {
        if (tokenAmounts[i] == 0) {

        IYearnVault yToken = IYearnVault(_yTokens[i]);
        uint256 yTokenAmount = ((tokenAmounts[i] * (10**yToken.decimals())) / yToken.pricePerShare());
        uint256 balance = yToken.balanceOf(address(this));
        if (yTokenAmount > balance) {
            yTokenAmount = balance;
        if (yTokenAmount == 0) {
        yToken.withdraw(yTokenAmount, to, maxLoss);
        (tokenAmounts[i], address(this));
    actualTokenAmounts = tokenAmounts;

The actual token withdrew from yToken.withdraw() will most certainly be less than the tokenAmounts[i], due to precision loss in the calculation of yTokenAmount.

As a result, IERC20(_vaultTokens[i]).safeTransfer(to, actualTokenAmounts[i]); in LpIssuer.sol#withdraw() will revert due to insufficant balance.


Change to:

tokenAmounts[i] = yToken.withdraw(yTokenAmount, to, maxLoss);

MihanixA (Mellow Protocol) confirmed and disagreed with severity:

Actually I don’t see how this could lead to fund loss. I think this one is a bug. @0xleastwood what do you think?

0xleastwood (judge) commented:

my understanding is that users won’t be able to withdraw pushed funds @MihanixA

so fund loss is related to not being able to withdraw rather than by extracting value from the protocol

Oxn1ck (Mellow Protocol) commented:

While we agree that this will prevent full withdrawal of the funds, that wil be limited to only a couple of wei’s which is the yearn precision loss. So in case you put 100eth you will be able to recover 100eth - 1wei. So we’d rather name the issue “some small amounts cannot be withdrawn from the pool”

0xleastwood (judge) commented:

If my understanding is correct, YearnVault._pull will withdraw yTokenAmount representing the yToken’s shares and then withdraw on this amount but return tokenAmounts where the amount withdrawn is typically less than the amount intended to be withdrawn. LpIssuer.withdraw() will expect actualTokenAmounts to be available to be transferred which isn’t exactly in the contract’s balance.

Let’s use an example:

  • Alice calls LpIssuer.withdraw() with tokensAmount[0] equal to 100 tokens. Let’s ignore the lpTokenAmount argument for the sake of this example.
  • _subvault().pull is called on this tokensAmount[0].
  • yTokenAmount is calculated according to ((tokenAmounts[i] * (10**yToken.decimals())) / yToken.pricePerShare()); which potentially leads to a slightly truncated output.
  • This truncated output represents the shares belonging to the user which is then parsed to yToken.withdraw().
  • yToken.withdraw() is likely less than 100 tokens and is sent to the LpIssuer.sol contract but actualTokenAmounts[0] is equal to 100 tokens.
  • LpIssuer.withdraw() attempts to send tokens to the withdrawer but is unable as the contract does not have sufficient balance. IERC20(_vaultTokens[i]).safeTransfer(to, actualTokenAmounts[i]);
  • If I’m not mistaken, it seems like this issue would be apparent on any withdrawal amount (assuming there is some amount truncated).
  • There is also an important edge case where the amount to withdraw from the yearn vault is greater than the available contract balance, it will always revert.

Oxn1ck (Mellow Protocol) commented:

Agreed, thank you!

[H-02] Wrong implementation of performanceFee can cause users to lose 50% to 100% of their funds

Submitted by WatchPug

A certain amount of lp tokens (shares of the vault) will be minted to the strategyPerformanceTreasury as performanceFee, the amount is calculated based on the minLpPriceFactor.

However, the current formula for toMint is wrong, which issues more than 100% of the current totalSupply of the lp token to the strategyPerformanceTreasury each time. Causing users to lose 50% to 100% of their funds after a few times.

address treasury = strategyParams.strategyPerformanceTreasury;
uint256 toMint = (baseSupply * minLpPriceFactor) / CommonLibrary.DENOMINATOR;
_mint(treasury, toMint);

Proof of Concept


  • strategyParams.performanceFee: 10e7 (1%)
  • Alice deposited 1,000 USDC, received 1000 lpToken; the totalSupply of the lpToken is now: 1000;
  • 3 days later, baseTvl increased to 1,001 USDC, Bob deposited 1 USDC and trigegred _chargeFees():
  • Expected Result: strategyPerformanceTreasury to receive about 0.01 lpToken (1% of 1 USDC);
  • Actual Result: minLpPriceFactor is about 1.001, and strategyPerformanceTreasury will received 1001 lpToken as performanceFee; Alice lose 50% of deposited funds.


Change to:

address treasury = strategyParams.strategyPerformanceTreasury;
uint256 toMint = (baseSupply * (minLpPriceFactor - CommonLibrary.DENOMINATOR) * performanceFee  / CommonLibrary.DENOMINATOR) / CommonLibrary.DENOMINATOR;
_mint(treasury, toMint);

MihanixA (Mellow Protocol) confirmed

[H-03] UniV3Vault.sol#collectEarnings() can be front run

Submitted by WatchPug

For UniV3Vault, it seems that lp fees are collected through collectEarnings() callable by the strategy and reinvested (rebalanced).

However, in the current implementation, unharvested yields are not included in tvl(), making it vulnerable to front-run attacks that steal pending yields.

Proof Of Concept


  • Current tvl() is 10 ETH and 40,000 USDC;
  • Current unclaimed yields (trading fees) is 1 ETH and 4,000 USDC;
  • strategy calls collectEarnings() to collect fees and reinvest;
  • The attacker sends a deposit tx with a higher gas price to deposit 10 ETH and 40,000 USDC, take 50% share of the pool;
  • After the transaction in step 1 is packed, the attacker calls withdraw() and retrieves 10.5 ETH and 42,000 USDC.

As a result, the attacker has stolen half of the pending yields in about 1 block of time.


Consider including fees in tvl().

For the code to calculate fees earned, please reference _computeFeesEarned() in G-UNI project:

MihanixA (Mellow Protocol) confirmed:

Thanks! Added tokensOwed to UniV3Vault’s tvl

[H-04] AaveVault does not update TVL on deposit/withdraw

Submitted by cmichel, also found by WatchPug

Aave uses rebasing tokens which means the token balance aToken.balanceOf(this) increases over time with the accrued interest.

The AaveVault.tvl uses a cached value that needs to be updated using a updateTvls call.

This call is not done when depositing tokens which allows an attacker to deposit tokens, get a fair share of the old tvl, update the tvl to include the interest, and then withdraw the LP tokens receiving a larger share of the new tvl, receiving back their initial deposit + the share of the interest. This can be done risk-free in a single transaction.

Proof Of Concept

  • Imagine an Aave Vault with a single vault token, and current TVL = 1,000 aTokens
  • Attacker calls LPIssuer.push([1000]). This loads the old, cached tvl. No updateTvl is called.
  • The 1000 underlying tokens are already balanced as there’s only one aToken, then the entire amount is pushed: aaveVault.transferAndPush([1000]). This deposists 1000 underlying tokens to the Aave lending pool and returns actualTokenAmounts = [1000]. After that the internal _tvls variable is updated with the latest aTokens. This includes the 1000 aTokens just deposited but also the new rebased aToken amounts, the interest the vault received from supplying the tokens since last updateTvls call. _tvls = _tvls + interest + 1000
  • The LP amount to mint amountToMint is still calculated on the old cached tvl memory variable, i.e., attacker receives amount / oldTvl = 1000/1000 = 100% of existing LP supply
  • Attacker withdraws the LP tokens for 50% of the new TVL (it has been updated in deposit’s transferAndPush call). Attacker receives 50% * _newTvl = 50% * (2,000 + interest) = 1000 + 0.5 * interest.
  • Attacker makes a profit of 0.5 * interest


The interest since the last TVL storage update can be stolen as Aave uses rebasing tokens but the tvl is not first recomputed when depositing. If the vaults experience low activity a significant amount of interest can accrue which can all be captured by taking a flashloan and depositing and withdrawing a large amount to capture a large share of this interest

Update the tvl when depositing and withdrawing before doing anything else.

MihanixA (Mellow Protocol) confirmed

Medium Risk Findings (7)

[M-01] User deposits don’t have min. return checks

Submitted by cmichel

The LPIssuer.deposit first computes balanced amounts on the user’s defined tokenAmounts. The idea is that LP tokens give the same percentage share of each vault tokens’ tvl, therefore the provided amounts should be balanced, meaning, the depositAmount / tvl ratio should be equal for all vault tokens.

But the strategist can frontrun the user’s deposit and rebalance the vault tokens, changing the tvl for each vault token which changes the rebalance. This frontrun can happen accidentally whenever the strategist rebalances

Proof Of Concept

There’s a vault with two tokens A and B, tvls are [500, 1500]

  • The user provides [500, 1500], expecting to get 50% of the share supply (is minted 100% of old total supply).
  • The strategist rebalances to [1000, 1000]
  • The user’s balanceFactor is min(500/1000, 1500/1000) = 1/2, their balancedAmounts are thus tvl * balanceFactor = [500, 500], the 1000 excess token B are refunded. In the end, they only received 500/(1000+500) = 33.3% of the total supply but used up all of their token A which they might have wanted to hold on to if they had known they’d only get 33.3% of the supply.


Users can get rekt when depositing as the received LP amount is unpredictable and lead to a trade using a very different balanced token mix that they never intended.

Add minimum return amount checks. Accept a function parameter that can be chosen by the user indicating their expected LP amount for their deposit tokenAmounts, then check that the actually minted LP token amount is above this parameter.

MihanixA (Mellow Protocol) confirmed

[M-02] Withdraw from AaveVault will receive less than actual share

Submitted by gzeon


AaveVault cache tvl and update it at the end of each _push and _pull. When withdrawing from LpIssuer, tokenAmounts is calculated using the cached tvl to be pulled from AaveVault. This will lead to user missing out their share of the accrued interest / donations to Aave since the last updateTvls.

Proof of Concept

Call updateTvls at the beginning of withdraw function if the _subvault will cache tvl

MihanixA (Mellow Protocol) confirmed

[M-03] Users can avoid paying vault fees

Submitted by cmichel

The LPIssuer.deposit/withdraw function charges protocol&management&performance fees through inflating the LP supply in the _chargeFees function. However, this LP fees minting is skipped if the elapsed time is less than the managementFeeChargeDelay:

if (elapsed < vg.delayedProtocolParams().managementFeeChargeDelay) {

This allows a user to avoid paying any fees if they deposit right after a charge fee interaction and withdraw within again managementFeeChargeDelay time period.

Proof Of Concept

This can be abused heavily on networks where the gas fees are a lot cheaper than the three vault fees:

  • deposit a tiny amount just to trigger the charge fees. This sets lastFeeCharge
  • deposit a huge amount, tvl increases significantly
  • let it earn interest. withdraw it before the managementFeeChargeDelay. No fees are paid, tvl reduces significantly
  • repeat, fees are only paid on tiny tvl


In the worst case, nobody pays fees by repeating the above actions.

Fees must always be charged on each deposit and withdrawal, even within the same block as it could be that a huge interest “harvest” comes in that an attacker sandwiches. Remove the if (elapsed < vg.delayedProtocolParams().managementFeeChargeDelay) { return; } code.

MihanixA (Mellow Protocol) disputed:

Charging fees on every deposit costs a lot of gas. If we notice users avoid paying fees we would just switch managementFeeChargeDelay to zero.

0xleastwood (judge) commented:

I don’t think this is a valid reason. At the end of the day, users can still abuse this feature and it is best to think about worse case scenario. I’ll keep this issue as high severity unless there is any reason not to? @MihanixA

MihanixA (Mellow Protocol) commented:

@0xleastwood Notice that users funds are not at risk and we can not remove this behaviour because this would lead to high withdraw/deposit fees. Anyway feel free to mark this issue anything seems fair to you.

0xleastwood (judge) commented:

While I understand funds aren’t directly at risk. It does seem like this issue can be exploited to earn additional yield at a lower opportunity cost as the user does not pay fees.

I think I’ll mark this as medium then.

2 — Med (M): vulns have a risk of 2 and are considered “Medium” severity when assets are not at direct risk, but the function of the protocol or its availability could be impacted, or leak value with a hypothetical attack path with stated assumptions, but external requirements.

[M-04] ChiefTrader.sol Wrong implementation of swapExactInput() and swapExactOutput()

Submitted by WatchPug, also found by Meta0xNull

When a caller calls ChiefTrader.sol#swapExactInput(), it will call ITrader(traderAddress).swapExactInput().

return ITrader(traderAddress).swapExactInput(0, amount, recipient, path, options);

However, in the current implementation, inputToken is not approved to the traderAddress.

For example, in UniV3Trader.sol#_swapExactInputSingle, at L89, it tries to transfer inputToken from msg.sender (which is ChiefTrader), since it’s not approved, this will revert.

Plus, the inputToken should also be transferred from the caller before calling the subtrader.

IERC20(input).safeTransferFrom(msg.sender, address(this), amount);

The same problem exists in swapExactOutput():

function swapExactOutput(
    uint256 traderId,
    uint256 amount,
    PathItem[] calldata path,
    bytes calldata options
) external returns (uint256) {
    require(traderId < _traders.length, TraderExceptionsLibrary.TRADER_NOT_FOUND_EXCEPTION);
    address traderAddress = _traders[traderId];
    address recipient = msg.sender;
    return ITrader(traderAddress).swapExactOutput(0, amount, recipient, path, options);


Approve the inputToken to the subtrader and transfer from the caller before calling ITrader.swapExactInput() and ITrader.swapExactOutput().

Or maybe just remove support of swapExactInput() and swapExactOutput() in ChiefTrader.

MihanixA (Mellow Protocol) confirmed:

In fact, tokens are approved to the trader The problem is that safeTransferFrom uses msg.sender which is ChiefTrader instead of recipient which is ERC20Vault.

[M-05] Admin can break _numberOfValidTokens

Submitted by cmichel, also found by gzeon and 0x1f8b

The ProtocolGovernance._numberOfValidTokens can be decreased by the admin in the ProtocolGovernance.removeFromTokenWhitelist function:

function removeFromTokenWhitelist(address addr) external {
    require(isAdmin(msg.sender), "ADM");
    _tokensAllowed[addr] = false;
    if (_tokenEverAdded[addr]) {
        // @audit admin can repeatedly call this function and sets _numberOfValidTokens to zero. because they don't flip _tokenEverAdded[addr] here

This function can be called repeatedly until the _numberOfValidTokens is zero.


The _numberOfValidTokens is wrong and with it the tokenWhitelist().

It seems that _numberOfValidTokens should only be decreased if the token was previously allowed:

function removeFromTokenWhitelist(address addr) external {
    require(isAdmin(msg.sender), "ADM");
    if (_tokensAllowed[addr]) {
        _tokensAllowed[addr] = false;

0xleastwood (judge) commented:

Can you confirm if this issue is valid or not? @MihanixA

0xleastwood (judge) commented:

Just realised this is a duplicate of another issue. Marking this as the primary issue

MihanixA (Mellow Protocol) commented:

@0xleastwood Confirmed, it’s a bug.

[M-06] UniswapV3’s path issue for swapExactOutput

Submitted by cmichel

UniswapV3 expects a path object like (tokenA, feeAB, tokenB, feeBC, tokenC). The UniV3Trader.swapExactOutput code tries to reverse this path to get to (tokenC, feeBC, tokenB, feeAB, tokenA) but that’s not what the _reverseBytes function does. Note that it reverts the entire encoded path byte array byte-by-byte which breaks the byte-order in a token. For example, tokenA would have every single byte reversed and lead to a different token.

function _reverseBytes(bytes memory input) internal pure returns (bytes memory output) {
    /** @audit reverses byte order? */
    for (uint256 i = 0; i < input.length; ++i) output[i] = input[input.length - 1 - i];


The UniV3Trader.swapExactOutput function with multi-hops is broken and cannot be used.

Don’t reverse the path byte-by-byte but element-by-element.

0xleastwood (judge) commented:

Can you confirm if this issue is valid or not? @MihanixA

0xleastwood (judge) commented:

I actually agree with the warden’s finding here. Leaving as is.

[M-07] Bad redirects can make it impossible to deposit & withdraw

Submitted by cmichel

The GatewayVault._push() function gets redirects from the strategyParams. If redirects[i] = j, vault index i’s deposits are redirected to vault index j.

Note that the deposits for vault index i are cleared, as they are redirected:

for (uint256 j = 0; j < _vaultTokens.length; j++) {
    uint256 vaultIndex = _subvaultNftsIndex[strategyParams.redirects[i]];
    amountsByVault[vaultIndex][j] += amountsByVault[i][j];
    amountsByVault[i][j] = 0;

The same is true for withdrawals in the _pull function. Users might not be able to withdraw this way.

If the redirects array is misconfigured, it’s possible that all amountsByVault are set to zero. For example, if 0 redirects to 1 and 1 redirects to 0. Or 0 redirects to itself, etc. There are many misconfigurations that can lead to not being able to deposit to the pool anymore.

The redirects[i] = j matrix needs to be restricted. If i is redirected to j, j may not redirect itself. Check for this when setting the redirects array.

0xleastwood (judge) commented:

Can you confirm if this issue is valid or not? @MihanixA

MihanixA (Mellow Protocol) confirmed:

@0xleastwood Confirmed

MihanixA (Mellow Protocol) commented:

(notice that this one is a deploy-related issue)

Low Risk Findings (12)

Non-Critical Findings (11)

Gas Optimizations (39)


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.