Part 2
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PerpetualsDEXFoundrySolidity
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Submission Details
Severity: high
Valid

Critical Flaw in Market's Debt Calculation Logic

binaryreturns

[M-4] Critical Flaw in Market's Debt Calculation Logic

Description:
The getRealizedDebtUsd function in Market contract contains a fundamental logical error in debt calculation. This function is pivotal for core protocol operations including vault credit/debt settlement.

Impact:

  • Incorrect debt calculations for markets

  • Flawed vault credit/debt settlement

  • Potential system-wide accounting mismatches

Proof of Concept:

/// @notice Returns the market's net realized debt in USD.
/// @param self The market storage pointer.
/// @return realizedDebtUsdX18 The market's net realized debt in USD as SD59x18.
function getRealizedDebtUsd(Data storage self) internal view returns (SD59x18 realizedDebtUsdX18) {
// prepare the credit deposits usd value variable;
UD60x18 creditDepositsValueUsdX18;
// if the credit deposits usd value cache is up to date, return the stored value
if (block.timestamp <= self.lastCreditDepositsValueRehydration) {
creditDepositsValueUsdX18 = ud60x18(self.creditDepositsValueCacheUsd);
} else {
// otherwise, we'll need to loop over credit deposits to calculate it
creditDepositsValueUsdX18 = getCreditDepositsValueUsd(self);
}
// finally after determining the market's latest credit deposits usd value, sum it with the stored net usd
// token issuance to return the net realized debt usd value
realizedDebtUsdX18 = creditDepositsValueUsdX18.intoSD59x18().add(sd59x18(self.netUsdTokenIssuance));
}
​

Scenario:

Market State:
- Credit deposits: 4000 USDC
- Issued tokens: 2000 USD
​
Current Calculation:
realizedDebt = 4000 + 2000 = 6000 USD // Wrong!
​
​

The current implementation adds credit deposits to issued tokens , leading to:

  1. Inflated debt calculations

  2. Incorrect credit capacity assessments

  3. Potential over-delegation of credit

Recommended Mitigation:
Kindly correct the wrong calculation

Updates

Lead Judging Commences

inallhonesty Lead Judge 7 months ago
Submission Judgement Published
Validated
Assigned finding tags:

Market::getRealizedDebtUsd incorrectly adds creditDeposits to netUsdTokenIssuance when calculating debt, causing accounting errors because credit deposits should reduce debt

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