#35815 [SC-Medium] `Market.present_value_borrow` should be roundUp

Submitted on Oct 9th 2024 at 16:11:41 UTC by @jasonxiale for IOP | Swaylend

Report ID: #35815
Report Type: Smart Contract
Report severity: Medium
Target: https://github.com/Swaylend/swaylend-monorepo/blob/develop/contracts/market/src/main.sw
Impacts:
- Protocol insolvency

Description

Brief/Intro

In order to guarantee the contract does not become insolvent, incoming assets should be rounded up, while outgoing assets should be rounded down.

So while a borrower pays debt, his payment should be rounded up. `Market.present_value_borrow` is used to calculate the amount of base token to pay for debt in `Market.withdraw_base` and other functions, but the function has a rounding error.

Vulnerability Details

As Market.present_value_borrow shows ```Rust 1124 pub fn present_value_borrow(base_borrow_index: u256, principal: u256) -> u256 { 1125 principal * base_borrow_index / BASE_INDEX_SCALE_15 <<<--- here should be roundUp 1126 } ```

Impact Details

the contract might be insolvent

References

Add any relevant links to documentation or code

Proof of Concept

The following Rust code is used to demonstrate that `principal * base_borrow_index / BASE_INDEX_SCALE_15` is rounded down

```bash rustc calc.rs ; .calc 1 1.000000004419746 ```

```Rust pub const BASE_INDEX_SCALE_15: u64 = 1_000_000_000_000_000; // 1e15

fn main() { let principal: u64 = 12345678; let base_borrow_index: u64 = 81000007; println!("{}", principal * base_borrow_index / BASE_INDEX_SCALE_15); println!("{}", principal as f64 * base_borrow_index as f64 / BASE_INDEX_SCALE_15 as f64); } ```

Previous#36065 [SC-Insight] `Market.update_market_configuration` should reuse old configuration's `base_token.decimals`Next#35760 [SC-Low] `market::available_to_borrow()` compares the collateral in USD against the borrow in base units