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Tadle
DeFiFoundry
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Submission Details
Severity: low
Valid

Incorrect Validation of `collateralRate` Allows for undercollateralization

tigerfrake

Summary

The createOffer() function in the PreMarkets contract requires that collateralRate be more than 100% as specified in this comment.
However, the current implementation does not enforce this requirement correctly.

Vulnerability Details

Current Check:

if (params.collateralRate < Constants.COLLATERAL_RATE_DECIMAL_SCALER) {
revert InvalidCollateralRate();
}

Issue:
The check only reverts if params.collateralRate is less than 10000. This allows params.collateralRate to be exactly 10000, which is 100%.

Impact

Financial Risk:
Allowing collateralRate to be 100% can lead to insufficient collateralization, increasing the risk of default and financial loss.

Tools Used

Manual Review

Recommendations

Update the check to ensure params.collateralRate is strictly more than 10000.

- if (params.collateralRate < Constants.COLLATERAL_RATE_DECIMAL_SCALER) {
+ if (params.collateralRate <= Constants.COLLATERAL_RATE_DECIMAL_SCALER) {
revert InvalidCollateralRate();
}
Updates

Lead Judging Commences

0xnevi Lead Judge over 1 year ago
Submission Judgement Published
Validated
Assigned finding tags:

finding-PreMarkets-off-by-one-Collateral-Rate-100%

I believe this is borderline informational/low. Despite this off-by-one error of the intended check, the difference between 100% and 101% is minimal, so I believe whether or not 100% is allowed has minimal impact. Ultimately, it still comes down to the risk level that users are willing to take

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