Summary

A timing discrepancy vulnerability has been identified in the ScrvusdOracleV2 implementation across different L2 chains. This vulnerability stems from the inherent characteristics of Merkle Patricia Tries (MPT) and how they affect response times for accessing state data at different address depths. An attacker could exploit these timing differences to perform arbitrage between chains when the scrvUSD price updates, creating MEV (Maximal Extractable Value) opportunities without actually compromising the oracle's data integrity.

Vulnerability Details

The vulnerability exists because the ScrvusdOracleV2 contract relies on block number verification that doesn't account for cross-chain timing differences:

The core issue originates from how different L2 chains process and update oracle data based on Ethereum mainnet blocks. According to research in "NURGLE: Exacerbating Resource Consumption in Blockchain State Storage via MPT Manipulation," the MPT structure causes varying access times depending on the position of an address in the trie.

Specifically:

1. The oracle updates approximately every 30 minutes with new mainnet block data

2. The time required to process these updates varies across L2 chains based on the MPT depth of the contract addresses

3. The contract's validation only ensures the block number is not outdated (assert self.last_block_number <= _block_number)

4. There are no mechanisms to synchronize updates across different chains

Even though the contract implements price smoothing, this mechanism is designed to prevent price manipulation rather than address cross-chain timing differences:

Impact

This vulnerability enables a sophisticated form of cross-chain arbitrage:

1. An attacker can monitor price updates on Ethereum mainnet

2. By understanding the MPT depth of oracle contracts on different L2 chains, they can predict which chains will update first

3. They can then execute trades on the faster-updating chain first, followed by corresponding trades on slower-updating chains

4. This creates a risk-free profit opportunity during the timing window between updates

The financial impact depends on:

• The magnitude of price changes in scrvUSD

• The liquidity available across different chains

• The update frequency (currently ~30 minutes)

• The predictability of the timing differences

While this doesn't compromise the integrity of the price data itself, it creates an unfair advantage for technically sophisticated actors and potentially reduces profits for legitimate liquidity providers.

Tools Used

Manual code review and analysis based on academic research on MPT vulnerabilities, specifically the paper "NURGLE: Exacerbating Resource Consumption in Blockchain State Storage via MPT Manipulation."

Recommendations

To mitigate this vulnerability, I recommend implementing an address rotation strategy with the following components:

1. Periodic Address Rotation:

   • Regularly deploy new oracle contracts at different addresses

   • Transfer authority to these new contracts on a scheduled basis

   • This randomizes the MPT position, disrupting timing prediction

2. Enhanced Validation:

1. Cross-Chain Coordination:

   • Implement a coordination mechanism to ensure updates across different chains occur within a smaller time window

   • Consider using a commit-reveal scheme for updates to prevent front-running

2. Monitoring System:

   • Deploy monitoring tools to detect unusual patterns of cross-chain trading activity around update times

   • Implement circuit breakers if suspicious arbitrage patterns are detected

By implementing these recommendations, particularly the address rotation strategy, the predictability of timing differences can be significantly reduced, making this attack vector impractical to exploit.