Liquidity Management
Gamma
DeFiFoundry
50,000 USDC
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Submission Details
Severity: low
Invalid

Unprotected initialization in proxy contracts allows front-running

anchabadze

Description:

All three proxy contracts in the protocol (PerpetualVault, GmxProxy, and KeeperProxy) have unprotected initialize() functions that can be front-run:

// KeeperProxy.sol
function initialize() external initializer {
__Ownable2Step_init(); // Caller becomes owner
}
​
// GmxProxy.sol
function initialize(
address _orderHandler,
address _liquidationHandler,
...
) external initializer {
__Ownable2Step_init(); // Caller becomes owner
orderHandler = _orderHandler;
// ...
}
​
// PerpetualVault.sol
function initialize(
address _market,
address _keeper,
...
) external initializer {
__Ownable2Step_init(); // Caller becomes owner
if (_market == address(0)) revert Error.ZeroValue();
// ...
}x

While the initializer modifier ensures one-time initialization, it doesn't restrict WHO can call it. The first caller of these functions becomes the owner through __Ownable2Step_init()

There is no factory pattern or other mechanism to ensure atomic deployment and initialization. This creates a window of opportunity where an attacker can front-run the intended owner's initialization transaction.

Impact:

A successful front-running attack would allow an attacker to:

  • Become the owner of critical protocol contracts

  • Control price feeds and thresholds

  • Manage keeper addresses

  • Control protocol parameters

  • Potentially steal user funds

  • Take over protocol governance

Recommended Mitigation:

Create factory contracts for atomic deployment and initialization or add access control to initialize() functions

Updates

Lead Judging Commences

n0kto Lead Judge 3 months ago
Submission Judgement Published
Invalidated
Reason: Non-acceptable severity
Assigned finding tags:

Informational or Gas

Please read the CodeHawks documentation to know which submissions are valid. If you disagree, provide a coded PoC and explain the real likelihood and the detailed impact on the mainnet without any supposition (if, it could, etc) to prove your point.

Admin is trusted / Malicious keepers

Please read the CodeHawks documentation to know which submissions are valid. If you disagree, provide a coded PoC and explain the real likelihood and the detailed impact on the mainnet without any supposition (if, it could, etc) to prove your point. Keepers are added by the admin, there is no "malicious keeper" and if there is a problem in those keepers, that's out of scope. ReadMe and known issues states: " * System relies heavily on keeper for executing trades * Single keeper point of failure if not properly distributed * Malicious keeper could potentially front-run or delay transactions * Assume that Keeper will always have enough gas to execute transactions. There is a pay execution fee function, but the assumption should be that there's more than enough gas to cover transaction failures, retries, etc * There are two spot swap functionalies: (1) using GMX swap and (2) using Paraswap. We can assume that any swap failure will be retried until success. " " * Heavy dependency on GMX protocol functioning correctly * Owner can update GMX-related addresses * Changes in GMX protocol could impact system operations * We can assume that the GMX keeper won't misbehave, delay, or go offline. " "Issues related to GMX Keepers being DOS'd or losing functionality would be considered invalid."

n0kto Lead Judge 3 months ago
Submission Judgement Published
Invalidated
Reason: Non-acceptable severity
Assigned finding tags:

Informational or Gas

Please read the CodeHawks documentation to know which submissions are valid. If you disagree, provide a coded PoC and explain the real likelihood and the detailed impact on the mainnet without any supposition (if, it could, etc) to prove your point.

Admin is trusted / Malicious keepers

Please read the CodeHawks documentation to know which submissions are valid. If you disagree, provide a coded PoC and explain the real likelihood and the detailed impact on the mainnet without any supposition (if, it could, etc) to prove your point. Keepers are added by the admin, there is no "malicious keeper" and if there is a problem in those keepers, that's out of scope. ReadMe and known issues states: " * System relies heavily on keeper for executing trades * Single keeper point of failure if not properly distributed * Malicious keeper could potentially front-run or delay transactions * Assume that Keeper will always have enough gas to execute transactions. There is a pay execution fee function, but the assumption should be that there's more than enough gas to cover transaction failures, retries, etc * There are two spot swap functionalies: (1) using GMX swap and (2) using Paraswap. We can assume that any swap failure will be retried until success. " " * Heavy dependency on GMX protocol functioning correctly * Owner can update GMX-related addresses * Changes in GMX protocol could impact system operations * We can assume that the GMX keeper won't misbehave, delay, or go offline. " "Issues related to GMX Keepers being DOS'd or losing functionality would be considered invalid."

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