Thunder Loan

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

`ThunderLoan::setAllowedToken` can permanently lock liquidity providers out from redeeming their tokens

Description

setAllowedToken(token, false) deletes the token-to-AssetToken mapping entry outright, with no check that the AssetToken still custodies underlying liquidity:

function setAllowedToken(IERC20 token, bool allowed) external onlyOwner returns (AssetToken) {
if (allowed) { ... }
else {
AssetToken assetToken = s_tokenToAssetToken[token];
delete s_tokenToAssetToken[token]; // @> wipes the only reference to the AssetToken
emit AllowedTokenSet(token, assetToken, allowed);
return assetToken;
}
}

Every user-facing function (deposit, redeem, flashloan) resolves the AssetToken via s_tokenToAssetToken[token] and is guarded by revertIfNotAllowedToken, which checks address(s_tokenToAssetToken[token]) != address(0). Once the mapping is deleted, isAllowedToken returns false and redeem reverts — but the underlying tokens are still held by the (now unreachable) AssetToken.

Risk

Likelihood: Medium

  • Requires the owner to disallow a token that still has deposits. This is a plausible operational action (delisting a token) with no safeguard preventing it while liquidity is outstanding.

Impact: Medium

  • All underlying tokens deposited for that token become unredeemable: redeem reverts on revertIfNotAllowedToken, permanently locking liquidity providers out from redeeming their tokens. There is no other path to pull funds out of the orphaned AssetToken.

Proof of Concept

// LPs deposit USDC -> AssetToken holds USDC.
// owner calls setAllowedToken(USDC, false) -> delete s_tokenToAssetToken[USDC].
// LP calls redeem(USDC, ...) -> revertIfNotAllowedToken reverts (mapping is address(0)).
// The USDC is stuck in the orphaned AssetToken with no way to withdraw.

Recommended Mitigation

Do not delete the mapping while the AssetToken still holds funds; instead flag it as disallowed-for-new-activity while still permitting redeem, or require the AssetToken to be fully drained first:

require(IERC20(token).balanceOf(address(assetToken)) == 0, "outstanding liquidity");
// or keep the mapping and use a separate bool to block deposits/flashloans but allow redeem.
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; } } ```

Support

FAQs

Can't find an answer? Chat with us on Discord, Twitter or Linkedin.

Give us feedback!