DittoETH

Summary

Liquidators are currently compensated for gas fees by multiplying the block base fee with the gas used. When the base fee is zero, we do not compensate for gas used.

Vulnerability Details

In the future the baseFee could be become zero and an unreliable metric for cost paid by liquidators.

In Proof of Stake the Validators have an interest in lowering the baseFee since that part of the fee is burned.
There are some strategies (1, 2) that validator can adopt to lower the baseFee to zero.

Impact

If the base fee is zero, liquidators only receive a percentage of the ethFilled as callerFee, making small position liquidations unprofitable.
callerFee = m.ethFilled.mulU88(m.callerFeePct);
This could increase bad debt in the protocol.

Tools Used

Manual Review.

Recommendations

Though the likelihood of this issue is uncertain, it's essential to prepare for all market conditions. One solution is refactoring the code to use an external Oracle like Chainlink for gas prices if the base fee is zero.