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Submission Details
Severity: low
Valid

Zero interest rate and fees while repaying the loan

0xumarkhatab

Summary

Borrowers can loan tokens and repay them at nearly zero interest and 0 percent fees in certain scenarios.
block.timestamp manipulation can aid in this.

Vulnerability Details

When a user wants to pay a loan, the contract calls the _calculateInterest function to calculate the interest accrued and fees that the user has to pay.

Unfortunately, it uses block.timestamp at its core for calculation which can be manipulated by a clever borrower who's also a miner.

He can manipulate it in such a way that the interest and fee approaches zero.

This will lead the person to pay zero interest and zero fee loans which are not intended.

Fuzzing

Code

​
function testFuzz_InterestRate(
uint interestRate,uint startTimestamp,uint debt,uint timestamp
) external {
interestRate = bound(interestRate,0, 5000);
// timestamp 64078774826 = year 4000
timestamp = bound(timestamp,0, 64078774826);
startTimestamp = bound(startTimestamp,0, 64078774826);
debt = bound(debt,0, 10000000);
unchecked {
uint256 lenderFee = 1000;
uint256 timeElapsed = timestamp - startTimestamp;
uint interest = (interestRate * debt * timeElapsed) / 10000 / 365 days;
uint fees = (lenderFee * interest) / 10000;
interest -= fees;
assert(interest>0 && fees>0);
}
}
}

Fuzz results

Here are some failure cases based on different values of the variables:

No. Loan.InterestRate Loan.startTimeStamp Loan.debt block.timestamp
1 2419 972 5332 6290
2 1698 4788 4 12906
3 597 13453 105151829 14137

Impact

-> Loss of funds for protocol

-> Disturbing inner accounting of the protocol to disturb the normal functioning

Tools Used

Foundry , Manual Review and some brain

Recommendations

There should be some invariant checks on interest and fee being greater than zero otherwise the transaction should revert.

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