QuantAMM

Summary

In the _getWeights function of MomentumUpdaterule.sol, performing division before multiplication can lead to rounding errors. These errors may cause incorrect results, such as zero values or large discrepancies.

The division operation is performed using ONE.div(locals.denominator), where locals.denominator is derived from the moving average or price data (which are read from oracles). Given that the denominator can exceed 1e18 (due to the 18 decimal precision of oracle prices), the result of ONE.div(locals.denominator) can lead to a value of zero when the denominator is sufficiently large, causing errors in subsequent calculations.

NOTE:

Same issue is in other rules like PowerChannelUpdateRule.sol and DifferenceMomentumUpdateRule.

Vulnerability Details

The denominator data comes from the oracle, which fetches prices and converts them to 18 decimals.

(UpdateWeightRunner gets this oracle data and passes it to rules to calculate new weights). However, as seen in the code below, div before mul can cause rounding to zero, leading to incorrect weight calculations.

https://github.com/Cyfrin/2024-12-quantamm/blob/a775db4273eb36e7b4536c5b60207c9f17541b92/pkg/pool-quantamm/contracts/rules/MomentumUpdateRule.sol#L52-L82

Impact

Rounding errors during division could lead to zero values, resulting in incorrect weight calculations.

Tools Used

vscode

Recommendations

Perform the multiplication before division to minimize rounding errors. This would ensure that any large values in the denominator are handled more accurately before the division takes place.