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

RToken should be interest-bearing token, but interest is not applied upon issuance

dimah7

Vulnerability Details

The RToken is meant to be interest-bearing token, similar to Aave's aToken. Users deposit crvUSD tokens get minted RTokens and this tokens should accrue interest based on the liquidityIndex. However upon minting:

function mint(
address caller,
address onBehalfOf,
uint256 amountToMint,
uint256 index
) external override onlyReservePool returns (bool, uint256, uint256, uint256) {
if (amountToMint == 0) {
return (false, 0, 0, 0);
}
uint256 amountScaled = amountToMint.rayDiv(index);
if (amountScaled == 0) revert InvalidAmount();
​
uint256 scaledBalance = balanceOf(onBehalfOf);
bool isFirstMint = scaledBalance == 0;
​
uint256 balanceIncrease = 0;
if (_userState[onBehalfOf].index != 0 && _userState[onBehalfOf].index < index) {
balanceIncrease = scaledBalance.rayMul(index) - scaledBalance.rayMul(_userState[onBehalfOf].index);
}
​
_userState[onBehalfOf].index = index.toUint128();
​
_mint(onBehalfOf, amountToMint.toUint128());
​
emit Mint(caller, onBehalfOf, amountToMint, index);
​
return (isFirstMint, amountToMint, totalSupply(), amountScaled);
}

We can see that in case of balance increase, this value is not applied anywhere, but only dynamically incremented, which has no effect. This makes the index-based interest accrual implementation completely inefficient, thus can lead to loss of RToken for lenders.

Impact

  • High, can cause loss of tokens for lenders, as they will not get more tokens regardless of the interactions with the protocol (movement of the liquidityIndex)

Tools Used

Manual Review

Recommendations

The balance increase should be applied also upon minting.

Updates

Lead Judging Commences

inallhonesty Lead Judge 7 months ago
Submission Judgement Published
Invalidated
Reason: Incorrect statement
Assigned finding tags:

RToken::mint calculates balanceIncrease (interest accrued since last interaction) but never mints it, causing users to lose earned interest between deposits

The balanceIncrease is the interest that has already accrued on the user's existing scaledBalance since their last interaction. It's not something you mint as new tokens in the _mint function.

inallhonesty Lead Judge 7 months ago
Submission Judgement Published
Invalidated
Reason: Incorrect statement
Assigned finding tags:

RToken::mint calculates balanceIncrease (interest accrued since last interaction) but never mints it, causing users to lose earned interest between deposits

The balanceIncrease is the interest that has already accrued on the user's existing scaledBalance since their last interaction. It's not something you mint as new tokens in the _mint function.

Appeal created

dimah7 Submitter
7 months ago
inallhonesty Lead Judge
6 months ago
inallhonesty Lead Judge 6 months ago
Submission Judgement Published
Invalidated
Reason: Incorrect statement
Assigned finding tags:

RToken::mint calculates balanceIncrease (interest accrued since last interaction) but never mints it, causing users to lose earned interest between deposits

The balanceIncrease is the interest that has already accrued on the user's existing scaledBalance since their last interaction. It's not something you mint as new tokens in the _mint function.

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