Thunder Loan

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

removing an allowed token permanently strands liquidity-provider deposits

Description

ThunderLoan::setAllowedToken(token, false) delists a token by delete s_tokenToAssetToken[token], but the token's AssetToken still custodies every liquidity provider's deposited underlying.

Both fund-return paths (redeem, flashloan) are guarded by revertIfNotAllowedToken, and redeem re-derives the AssetToken from the now-deleted mapping. After a token is disallowed, LPs can never redeem and their underlying is permanently stranded in the orphaned AssetToken, which nothing can move.

} else {
AssetToken assetToken = s_tokenToAssetToken[token];
@> delete s_tokenToAssetToken[token]; // LP funds remain in assetToken, now unreachable
emit AllowedTokenSet(token, assetToken, allowed);
return assetToken;
}

Risk

Likelihood: Medium

  • A normal, expected admin action (delisting a token) triggers it; no malice required.

Impact: High

  • All liquidity for that token is permanently frozen with no recovery path.

Proof of Concept

The test allows tokenA, has an LP deposit 100e18, then the owner delists the token. A subsequent redeem — which would otherwise succeed — reverts with ThunderLoan__NotAllowedToken, and the underlying remains held by the orphaned AssetToken with no function able to release it:

function test_G1_removingTokenStrandsDeposits() public allowTokenA {
// LP deposits 100e18 into tokenA
vm.prank(thunderLoan.owner());
thunderLoan.setAllowedToken(tokenA, false);
vm.prank(lp);
vm.expectRevert(abi.encodeWithSelector(ThunderLoan.ThunderLoan__NotAllowedToken.selector, address(tokenA)));
thunderLoan.redeem(tokenA, 1e18); // can never withdraw again
assertEq(tokenA.balanceOf(address(asset)), 100e18); // funds still locked in AssetToken
}

Recommended Mitigation

Do not delete the mapping on delisting. Keep redeem available to existing depositors (block only new deposits), or add a migration/withdrawal path so LPs can always exit.

Updates

Lead Judging Commences

ai-first-flight-judge Lead Judge about 4 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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