The Standard

Summary

Calls to Chainlink price feeds could potentially revert, because in rare cases feeds can be paused/disabled. But the Protocol doesn't implement any safety mechanism to handle such scenarios.

Issue Details

Chainlink oracles may be taken offline during extreme market conditions, so price feeds consumers should always consider these scenarios.

LiquidationPool utilizes price feeds, but has two weak points:

1. The address for EUR/USD price feed is stored in immutable eurUsd variable, and can't be upgraded after contract creation

2. Calls to latestRoundData are not handled for failures

LiquidationPool uses price feeds during vaults liquidations, and here is how this flow looks like:

1. Off-chain monitoring detects a SmartVault's collateral rate dropped, and the vault now is a subject to liquidation

2. A call to LiquidationPoolManager.runLiquidation made

3. Which internally calls LiquidationPool.distributeAssets

4. distributeAssets function uses price feeds to determine rewards for stakers. Not only EUR/USD price feed is used, but more importantly - all underlying(whitelisted) tokens held by the vault will also be queried for their prices.

Impact

If a price feed goes offline, any calls will revert, which means all vaults liquidations will not be possible. And, since this situation most likely will happen during extreme market condition, it may lead to significant drop in value for borrowers' assets, effectively destabilizing the value of EUROs token, and making stakers receive less rewards from liquidations.

At least 6 Chainlink price feeds will be used in the initial deployment. Also, since new ERC20 "whitelisted" tokens can be added later, even more price feeds can be in use by the protocol.

Note that, price feeds for "whitelisted" tokens used during liquidations only if a particular token was deposited to the vault. But a borrower (or a malicious entity) can deposit 1 WEI of value to the vault to force the protocol use a "broken" price feed.
This scenario significantly expands the surface for a potential DoS attack.

Recommendation

1. Consider adding functionality to update EUR/USD price feed address

2. There is no "silver bullet" solution for reverted calls on price feeds. A concrete solution will depend on the protocol's infrastructure and the risk model. I'd suggest to review Chainlink: Price Feeds Risk Mitigation for potential solutions