57771 sc medium fee not collected in forcerepay when should

Submitted on Oct 28th 2025 at 19:44:26 UTC by @dldLambda for Audit Comp | Alchemix V3

• Report ID: #57771

• Report Type: Smart Contract

• Report severity: Medium

• Target: https://github.com/alchemix-finance/v3-poc/blob/immunefi_audit/src/AlchemistV3.sol

• Impacts:

  • Contract fails to deliver promised returns, but doesn't lose value

Description

Brief/Intro

In _forceRepay, after subtracting the repayment amount from collateral, the protocol calculates protocolFeeTotal and checks if (account.collateralBalance > protocolFeeTotal) before deducting and transferring the fee to protocolFeeReceiver. Because of the strict > comparison, the fee is not deducted when account.collateralBalance == protocolFeeTotal. Other parts of the code (e.g., repay) allow equality — this leads to inconsistent behavior and potential loss of protocol revenue in edge cases.

Vulnerability Details

Let's look at the code:

1. _forceRepay:

        if (account.collateralBalance > protocolFeeTotal) {
            account.collateralBalance -= protocolFeeTotal;
            // Transfer the protocol fee to the protocol fee receiver
            TokenUtils.safeTransfer(myt, protocolFeeReceiver, protocolFeeTotal);
        }

1. repay: (correct)

        // Debt is subject to protocol fee similar to redemptions
        uint256 feeAmount = creditToYield * protocolFee / BPS;
        if (feeAmount > account.collateralBalance) {
            revert("Not enough collateral to pay for debt fee");
        } else {
            account.collateralBalance -= creditToYield * protocolFee / BPS;
        }

1. _doLiquidation: (correct)

        // send base fee to liquidator if available
        if (feeInYield > 0 && account.collateralBalance >= feeInYield) {
            TokenUtils.safeTransfer(myt, msg.sender, feeInYield);
        }

As you can see, in functions repay and _doLiquidation fee is written off if fee<=account.collateralBalance.

However, function _forceRepay, when fee = account.collateralBalance, considers that the fee cannot be written off.

This is an unjustified inconsistency and may result in loss of fee.

Impact Details

The protocol does not receive the expected protocol fee in edge cases => economic damage (lost commission)

References

https://github.com/alchemix-finance/v3-poc/blob/a192ab313c81ba3ab621d9ca1ee000110fbdd1e9/src/AlchemistV3.sol#L852 - _doLiquidation

https://github.com/alchemix-finance/v3-poc/blob/a192ab313c81ba3ab621d9ca1ee000110fbdd1e9/src/AlchemistV3.sol#L498 - repay

https://github.com/alchemix-finance/v3-poc/blob/a192ab313c81ba3ab621d9ca1ee000110fbdd1e9/src/AlchemistV3.sol#L738 - _forceRepay

Proof of Concept

Proof of Concept

Run this simple script-simulation:

// SPDX-License-Identifier: MIT
pragma solidity ^0.8.28;

import "forge-std/Script.sol";
import "forge-std/console.sol";

contract ForceRepaySimulation is Script {

    struct ForceRepayAccount {
        uint256 collateralBalance;
        uint256 protocolFeeTotal;
    }

    function simulateForceRepay(ForceRepayAccount memory account) internal pure returns (bool commissionPaid) {
        if (account.collateralBalance > account.protocolFeeTotal) {
            commissionPaid = true; 
        } else {
            commissionPaid = false; 
        }
    }

    function run() external {
        console.log("=== ForceRepay Bug Simulation ===");

        ForceRepayAccount memory a1 = ForceRepayAccount({collateralBalance: 100, protocolFeeTotal: 100});
        ForceRepayAccount memory a2 = ForceRepayAccount({collateralBalance: 101, protocolFeeTotal: 100});
        ForceRepayAccount memory a3 = ForceRepayAccount({collateralBalance: 50, protocolFeeTotal: 100});

        console.log("a1 commissionPaid:", simulateForceRepay(a1)); // false
        console.log("a2 commissionPaid:", simulateForceRepay(a2)); // true
        console.log("a3 commissionPaid:", simulateForceRepay(a3)); // false
    }
}

commands:

1. forge init poc

2. cd poc

3. add this script to script/ folder

4. forge build

5. forge script script/ForceRepaySimulation.s.sol:ForceRepaySimulation --broadcast

And you will see:

== Logs ==
  === ForceRepay Bug Simulation ===
  a1 commissionPaid: false
  a2 commissionPaid: true
  a3 commissionPaid: false