Part 2

Summary

The convertMarketsCreditDepositsToUsdc function is vulnerable to DEX Swap Strategy Manipulation, which could allow an attacker to steal funds, manipulate swap results, or cause other unintended behavior. This vulnerability arises due to insufficient validation of swap strategies and paths, as well as the potential for compromised or malicious system keepers to exploit the function.

Vulnerability Details

The function relies on external DEX swap strategies and paths to convert assets into USDC. However, it does not adequately validate the integrity or security of these swap strategies and paths. Additionally, the function is protected by the onlyRegisteredSystemKeepers modifier, but this does not prevent exploitation if a system keeper is compromised or acts maliciously.

Exploitation Scenarios

1. Malicious Swap Strategy:

   • An attacker deploys a malicious swap strategy that steals input tokens or manipulates swap results.

   • A compromised or malicious system keeper uses the malicious strategy in the convertMarketsCreditDepositsToUsdc function.

2. Manipulated Swap Path:

   • An attacker provides a manipulated swap path that routes assets through a malicious contract or unfavorable DEX pool.

Impact

• An attacker could steal funds by deploying a malicious swap strategy that diverts input tokens to their address.

• Manipulated swap paths could result in significant slippage or unfavorable exchange rates, leading to financial losses.

Tools Used

**Manual Review **

Recommendations

Maintain a whitelist of approved swap strategies that are trusted and Ensure that swap paths only route through approved tokens and DEX pools