Thunder Loan

AI First Flight #7
Beginner FriendlyFoundryDeFiOracle
EXP
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Submission Details
Severity: medium
Valid

setAllowedToken(false) traps funds in orphaned AssetToken

Root + Impact

When setAllowedToken(token, false) is called, the mapping entry is deleted but the AssetToken contract still holds underlying tokens. There is no mechanism to recover these funds, permanently trapping them.

Description

• Normal behavior: When a token is removed from the allowed list, any remaining underlying tokens in its AssetToken should be recoverable by the owner or returned to depositors. • Specific issue: The function only deletes the mapping entry. The AssetToken contract continues to hold any underlying tokens, and with the mapping deleted, there is no way to interact with that AssetToken through the protocol.

Risk

Likelihood: Medium — requires the owner to disallow a token while the AssetToken has a non-zero balance.

Impact: Medium — all underlying tokens in the AssetToken are permanently lost. No recovery path exists.

Proof of Concept

solidity

// AssetToken holds 5000 underlying tokens
// Owner calls setAllowedToken(token, false)
thunderLoan.setAllowedToken(token, false);
// Mapping deleted: s_tokenToAssetToken[token] = address(0)
// 5000 tokens remain in AssetToken but are unreachable
// No function can recover them
assertEq(token.balanceOf(address(assetToken)), 5000);
// assetToken is orphaned

Recommended Mitigation

solidity

function setAllowedToken(IERC20 token, bool allowed) external onlyOwner {
if (allowed) {
// ... existing logic ...
} else {
AssetToken assetToken = s_tokenToAssetToken[token];
uint256 remaining = IERC20(assetToken.getUnderlying()).balanceOf(address(assetToken));
if (remaining > 0) {
assetToken.transferUnderlyingTo(owner(), remaining);
}
delete s_tokenToAssetToken[token];
emit AllowedTokenSet(token, assetToken, allowed);
}
}
Updates

Lead Judging Commences

ai-first-flight-judge Lead Judge about 3 hours ago
Submission Judgement Published
Validated
Assigned finding tags:

[M-01] 'ThunderLoan::setAllowedToken' can permanently lock liquidity providers out from redeeming their tokens

## Description If the 'ThunderLoan::setAllowedToken' function is called with the intention of setting an allowed token to false and thus deleting the assetToken to token mapping; nobody would be able to redeem funds of that token in the 'ThunderLoan::redeem' function and thus have them locked away without access. ## Vulnerability Details If the owner sets an allowed token to false, this deletes the mapping of the asset token to that ERC20. If this is done, and a liquidity provider has already deposited ERC20 tokens of that type, then the liquidity provider will not be able to redeem them in the 'ThunderLoan::redeem' function. ```solidity function setAllowedToken(IERC20 token, bool allowed) external onlyOwner returns (AssetToken) { if (allowed) { if (address(s_tokenToAssetToken[token]) != address(0)) { revert ThunderLoan__AlreadyAllowed(); } string memory name = string.concat("ThunderLoan ", IERC20Metadata(address(token)).name()); string memory symbol = string.concat("tl", IERC20Metadata(address(token)).symbol()); AssetToken assetToken = new AssetToken(address(this), token, name, symbol); s_tokenToAssetToken[token] = assetToken; emit AllowedTokenSet(token, assetToken, allowed); return assetToken; } else { AssetToken assetToken = s_tokenToAssetToken[token]; @> delete s_tokenToAssetToken[token]; emit AllowedTokenSet(token, assetToken, allowed); return assetToken; } } ``` ```solidity function redeem( IERC20 token, uint256 amountOfAssetToken ) external revertIfZero(amountOfAssetToken) @> revertIfNotAllowedToken(token) { AssetToken assetToken = s_tokenToAssetToken[token]; uint256 exchangeRate = assetToken.getExchangeRate(); if (amountOfAssetToken == type(uint256).max) { amountOfAssetToken = assetToken.balanceOf(msg.sender); } uint256 amountUnderlying = (amountOfAssetToken * exchangeRate) / assetToken.EXCHANGE_RATE_PRECISION(); emit Redeemed(msg.sender, token, amountOfAssetToken, amountUnderlying); assetToken.burn(msg.sender, amountOfAssetToken); assetToken.transferUnderlyingTo(msg.sender, amountUnderlying); } ``` ## Impact The below test passes with a ThunderLoan\_\_NotAllowedToken error. Proving that a liquidity provider cannot redeem their deposited tokens if the setAllowedToken is set to false, Locking them out of their tokens. ```solidity function testCannotRedeemNonAllowedTokenAfterDepositingToken() public { vm.prank(thunderLoan.owner()); AssetToken assetToken = thunderLoan.setAllowedToken(tokenA, true); tokenA.mint(liquidityProvider, AMOUNT); vm.startPrank(liquidityProvider); tokenA.approve(address(thunderLoan), AMOUNT); thunderLoan.deposit(tokenA, AMOUNT); vm.stopPrank(); vm.prank(thunderLoan.owner()); thunderLoan.setAllowedToken(tokenA, false); vm.expectRevert(abi.encodeWithSelector(ThunderLoan.ThunderLoan__NotAllowedToken.selector, address(tokenA))); vm.startPrank(liquidityProvider); thunderLoan.redeem(tokenA, AMOUNT_LESS); vm.stopPrank(); } ``` ## Recommendations It would be suggested to add a check if that assetToken holds any balance of the ERC20, if so, then you cannot remove the mapping. ```diff function setAllowedToken(IERC20 token, bool allowed) external onlyOwner returns (AssetToken) { if (allowed) { if (address(s_tokenToAssetToken[token]) != address(0)) { revert ThunderLoan__AlreadyAllowed(); } string memory name = string.concat("ThunderLoan ", IERC20Metadata(address(token)).name()); string memory symbol = string.concat("tl", IERC20Metadata(address(token)).symbol()); AssetToken assetToken = new AssetToken(address(this), token, name, symbol); s_tokenToAssetToken[token] = assetToken; emit AllowedTokenSet(token, assetToken, allowed); return assetToken; } else { AssetToken assetToken = s_tokenToAssetToken[token]; + uint256 hasTokenBalance = IERC20(token).balanceOf(address(assetToken)); + if (hasTokenBalance == 0) { delete s_tokenToAssetToken[token]; emit AllowedTokenSet(token, assetToken, allowed); + } return assetToken; } } ```

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