Themis Protocol Hack Analysis
Themis Protocol Hack Analysis
Overview:
On June 28, 2023, Themis Protocol suffered an attack, due to a price manipulation vulnerability, leading to a loss of ~365K USD
Smart Contract Hack Overview:
Decoding the Smart Contract Vulnerability:
- The attacker initiated a flashloan of 22,000 ETH from Aave.
- They borrowed an additional 10,000 ETH from one Uniswap pool and 8,000 ETH from another Uniswap pool.
- The borrowed 22,000 ETH was deposited, and in return, they borrowed DAI, USDT, USDC, ARB, and WBTC.
- Afterwards, they withdrew 55 ETH and created a new contract.
- The 55 ETH was added to a Balancer pool, and as a result, the attacker obtained B-wstETH-WETH-Stable-gauge LP tokens.
- Using the corresponding pool on Balancer, they swapped WETH for wstETH.
- The price of the LP token B-wstETH-WETH-Stable-gauge was checked.
- Although the contract responsible for the price query was not open-source, it was observed through the call stack that it followed a process:
- First, it checked the quantities of both tokens (WETH and wstETH) in the pool.
- Then, it verified the prices of WETH and wstETH.
- The contract computed the price by multiplying the WETH price by its quantity and adding it to the result of multiplying the wstETH price by its quantity.
- This value was then divided by the total supply of LP tokens.
- By manipulating the token quantities in the pool via the swap operation, the attacker could increase the LP token’s price and subsequently borrow 317 ETH.
Mitigation and Best Practices:
- Always validate your code by writing comprehensive test cases that cover all the possible business logic.
- To prevent such vulnerabilities, the best Smart Contract auditors must examine the Smart Contracts for logical issues. We at CredShields provide smart contract security and end-to-end security of web applications and externally exposed networks. Schedule a call at https://credshields.com/
- Scan your Solidity contracts against the latest common security vulnerabilities with 130+ detections at SolidityScan
Conclusion:
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