Core Contracts
Regnum Aurum Acquisition Corp
HardhatReal World AssetsNFT
77,280 USDC
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Submission Details
Severity: low
Valid

`FeeCollector::_initializeFeeTypes` implements the wrong fee value for Swap Tax and NFT Royalty

kiteweb3

Summary

The FeeCollector::_initializeFeeTypes function initializes the default fee types according to the protocol rule. The issue arises Swap Tax (feeTypes[6]) and NFT Royalty Fees (feeTypes[7]) fee distribution assigned value.
While the code comment indicates a "2% total" fee, the actual implementation uses 2000 basis points (20%). This creates a severe discrepancy between the documented and actual fee behavior, leading to overcharging of users.

Vulnerability Details

function _initializeFeeTypes() internal {
// Protocol Fees: 80% to veRAAC holders, 20% to treasury
feeTypes[0] = FeeType({
veRAACShare: 8000, // 80%
burnShare: 0,
repairShare: 0,
treasuryShare: 2000 // 20%
});
// Lending Fees: Interest income distribution
feeTypes[1] = FeeType({
veRAACShare: 7000, // 70%
burnShare: 0,
repairShare: 0,
treasuryShare: 3000 // 30%
});
// Performance Fees: 20% from yield products
feeTypes[2] = FeeType({
veRAACShare: 6000, // 60%
burnShare: 0,
repairShare: 0,
treasuryShare: 4000 // 40%
});
// Insurance Fees: 3% from NFT loans
feeTypes[3] = FeeType({
veRAACShare: 5000, // 50%
burnShare: 0,
repairShare: 2000, // 20%
treasuryShare: 3000 // 30%
});
// Mint/Redeem Fees
feeTypes[4] = FeeType({
veRAACShare: 6000, // 60%
burnShare: 0,
repairShare: 2000, // 20%
treasuryShare: 2000 // 20%
});
// Vault Fees
feeTypes[5] = FeeType({
veRAACShare: 7000, // 70%
burnShare: 0,
repairShare: 0,
treasuryShare: 3000 // 30%
});
@> // Buy/Sell Swap Tax (2% total)
feeTypes[6] = FeeType({
@> veRAACShare: 500, // 0.5%
@> burnShare: 500, // 0.5%
@> repairShare: 1000, // 1.0%
treasuryShare: 0
});
@> // NFT Royalty Fees (2% total)
feeTypes[7] = FeeType({
@> veRAACShare: 500, // 0.5%
burnShare: 0,
@> repairShare: 1000, // 1.0%
@> treasuryShare: 500 // 0.5%
});
}

Impact

The issue lies in the basis point calculation:

Comment states: 2% total

Actual implementation:

Buy/Sell Swap Tax

  • veRAACShare: 500 basis points = 5%

  • burnShare: 500 basis points = 5%

  • repairShare: 1000 basis points = 10%
    Total: 2000 basis points = 20%

NFT Royalty Fees

  • veRAACShare: 500 basis points = 5%

  • repairShare: 1000 basis points = 10%

  • treasuryShare: 500 basis points = 5%
    Total: 2000 basis points = 20%

The users are charged 20% instead of the documented 2% on swaps and NFT Royalty resulting in 10x higher fees than documented. This leads to financial losses for users and losses of protocol credibility.

Tools Used

Manual review

Recommendations

Align implementation with documentation.

function _initializeFeeTypes() internal {
// Protocol Fees: 80% to veRAAC holders, 20% to treasury
feeTypes[0] = FeeType({
veRAACShare: 8000, // 80%
burnShare: 0,
repairShare: 0,
treasuryShare: 2000 // 20%
});
// Lending Fees: Interest income distribution
feeTypes[1] = FeeType({
veRAACShare: 7000, // 70%
burnShare: 0,
repairShare: 0,
treasuryShare: 3000 // 30%
});
// Performance Fees: 20% from yield products
feeTypes[2] = FeeType({
veRAACShare: 6000, // 60%
burnShare: 0,
repairShare: 0,
treasuryShare: 4000 // 40%
});
// Insurance Fees: 3% from NFT loans
feeTypes[3] = FeeType({
veRAACShare: 5000, // 50%
burnShare: 0,
repairShare: 2000, // 20%
treasuryShare: 3000 // 30%
});
// Mint/Redeem Fees
feeTypes[4] = FeeType({
veRAACShare: 6000, // 60%
burnShare: 0,
repairShare: 2000, // 20%
treasuryShare: 2000 // 20%
});
// Vault Fees
feeTypes[5] = FeeType({
veRAACShare: 7000, // 70%
burnShare: 0,
repairShare: 0,
treasuryShare: 3000 // 30%
});
// Buy/Sell Swap Tax (2% total)
feeTypes[6] = FeeType({
- veRAACShare: 500, // 0.5%
+ veRAACShare: 50, // 0.5%
- burnShare: 500, // 0.5%
+ burnShare: 50, // 0.5%
- repairShare: 1000, // 1.0%
+ repairShare: 100, // 1.0%
treasuryShare: 0
});
// NFT Royalty Fees (2% total)
feeTypes[7] = FeeType({
- veRAACShare: 500, // 0.5%
+ veRAACShare: 50, // 0.5%
burnShare: 0,
- repairShare: 1000, // 1.0%
+ repairShare: 100, // 1.0%
- treasuryShare: 500 // 0.5%
+ treasuryShare: 50 // 0.5%
});
}
Updates

Lead Judging Commences

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

Fee shares for fee type 6 and 7 inside FeeCollector do not total up to the expected 10000 basis points, this leads to update problems, moreover they are 10x the specifications

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