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Balancer V2

94%

Previous versions

Process Quality Review (0.8)

Balancer V2

Final score:94%
Date:27 Apr 2022
Audit Process:version 0.8
Author:Nick
PQR Score:94%

PASS

Protocol Website:https://balancer.fi

Hack History

Date:28 Jun 2020
Details: $500K was extracted from a Balancer pool that held STA tokens. The attacker was able to exploit the incompatibility between deflationary tokens (such as STA) which caused "a mismatch between the actual STA balance of BPool and its internal bookkeeping records". This allowed the exploiter to repeatedly swap out the STA of the BPool via a flash loan from dYdX that they then used for a reentrancy manipulation of the gulp() function which resulted in a falsified maintained state of the _records[token].balance function.
Reference Linklink

Scoring Appendix

The final review score is indicated as a percentage. The percentage is calculated as Achieved Points due to MAX Possible Points. For each element the answer can be either Yes/No or a percentage. For a detailed breakdown of the individual weights of each question, please consult this document.

The blockchain used by this protocol
Arbitrum
Ethereum
Polygon
#QuestionAnswer
100%
1.100%
2.100%
3.Yes
4.100%
5.100
100%
6.Yes
7.Yes
8.100%
9.100%
90%
10.100%
11.50%
12.Yes
13.100%
14.Yes
15.Yes
100%
16.100%
17.100%
82%
18.100%
19.100%
20.100%
21.100%
22.100%
23.100%
24.30%
25.0%
100%
26.100%
27.Yes
28.Yes
Total:94%

Very simply, the audit looks for the following declarations from the developer's site. With these declarations, it is reasonable to trust the smart contracts.

  • Here is my smart contract on the blockchain
  • You can see it matches a software repository used to develop the code
  • Here is the documentation that explains what my smart contract does
  • Here are the tests I ran to verify my smart contract
  • Here are the audit(s) performed to review my code by third party experts

This report is for informational purposes only and does not constitute investment advice of any kind, nor does it constitute an offer to provide investment advisory or other services. Nothing in this report shall be considered a solicitation or offer to buy or sell any security, token, future, option or other financial instrument or to offer or provide any investment advice or service to any person in any jurisdiction. Nothing contained in this report constitutes investment advice or offers any opinion with respect to the suitability of any security, and the views expressed in this report should not be taken as advice to buy, sell or hold any security. The information in this report should not be relied upon for the purpose of investing. In preparing the information contained in this report, we have not taken into account the investment needs, objectives and financial circumstances of any particular investor. This information has no regard to the specific investment objectives, financial situation and particular needs of any specific recipient of this information and investments discussed may not be suitable for all investors.

Any views expressed in this report by us were prepared based upon the information available to us at the time such views were written. The views expressed within this report are limited to DeFiSafety and the author and do not reflect those of any additional or third party and are strictly based upon DeFiSafety, its authors, interpretations and evaluation of relevant data. Changed or additional information could cause such views to change. All information is subject to possible correction. Information may quickly become unreliable for various reasons, including changes in market conditions or economic circumstances.

This completed report is copyright (c) DeFiSafety 2021. Permission is given to copy in whole, retaining this copyright label.

Smart Contracts & Team

100%

This section looks at the code deployed on the relevant chain that gets reviewed and its corresponding software repository. The document explaining these questions is here.

1. Are the smart contract addresses easy to find? (%)

Answer: 100%

They can be found at https://dev.balancer.fi/references/contracts/contract-addresses, as indicated in the Appendix.

Percentage Score Guidance:
100%
Clearly labelled and on website, documents or repository, quick to find
70%
Clearly labelled and on website, docs or repo but takes a bit of looking
40%
Addresses in mainnet.json, in discord or sub graph, etc
20%
Address found but labeling not clear or easy to find
0%
Executing addresses could not be found

2. How active is the primary contract? (%)

Answer: 100%

Contract Vault is used 100+ times a day, as indicated in the Appendix.

Percentage Score Guidance:
100%
More than 10 transactions a day
70%
More than 10 transactions a week
40%
More than 10 transactions a month
10%
Less than 10 transactions a month
0%
No activity

3. Does the protocol have a public software repository? (Y/N)

Answer: Yes

Balancer uses GitHub

Score Guidance:
Yes
There is a public software repository with the code at a minimum, but also normally test and scripts. Even if the repository was created just to hold the files and has just 1 transaction.
No
For teams with private repositories.

4. Is there a development history visible? (%)

Answer: 100%

At 900 commits and 7 branches, it's clear that Balancer's development history is well balanced.

Percentage Score Guidance:
100%
Any one of 100+ commits, 10+branches
70%
Any one of 70+ commits, 7+branches
50%
Any one of 50+ commits, 5+branches
30%
Any one of 30+ commits, 3+branches
0%
Less than 2 branches or less than 30 commits

5. Is the team public (not anonymous)?

Answer: 100

Many of Balancer's team members are public.

Score Guidance:
100%
At least two names can be easily found in the protocol's website, documentation or medium. These are then confirmed by the personal websites of the individuals / their linkedin / twitter.
50%
At least one public name can be found to be working on the protocol.
0%
No public team members could be found.

Documentation

100%

The difference between this and the old link is solely the link.    This section looks at the software documentation. The document explaining these questions is here.

6. Is there a whitepaper? (Y/N)

Answer: Yes

Location: https://docs.balancer.fi/

7. Is the protocol's software architecture documented? (Y/N)

Answer: Yes

Balancer's software architecture is documented in full.

Score Guidance:
Yes
The documents identify software architecture and contract interaction through any of the following: diagrams, arrows, specific reference to software functions or a written explanation on how smart contracts interact.
No
Protocols receive a "no" if none of these are included.

8. Does the software documentation fully cover the deployed contracts' source code? (%)

Answer: 100%

There is full coverage of deployed contracts by software function documentation in Balancer's developer docs.

Percentage Score Guidance:
100%
All contracts and functions documented
80%
Only the major functions documented
79 - 1%
Estimate of the level of software documentation
0%
No software documentation

9. Is it possible to trace the documented software to its implementation in the protocol's source code? (%)

Answer: 100%

There is full and explicit traceability between Balancer's documented software functions and their respective locations within their GitHub source code.

Percentage Score Guidance:
100%
Clear explicit traceability between code and documentation at a requirement level for all code
60%
Clear association between code and documents via non explicit traceability
40%
Documentation lists all the functions and describes their functions
0%
No connection between documentation and code

Testing

90%

10. Has the protocol tested their deployed code? (%)

Answer: 100%

Code examples are in the Appendix at the end of this report.. As per the SLOC, there is 170% testing to code (TtC).    This score is guided by the Test to Code ratio (TtC). Generally a good test to code ratio is over 100%. However, the reviewer's best judgement is the final deciding factor.

Percentage Score Guidance:
100%
TtC > 120% Both unit and system test visible
80%
TtC > 80% Both unit and system test visible
40%
TtC < 80% Some tests visible
0%
No tests obvious

11. How covered is the protocol's code? (%)

Answer: 50%

There is currently no visible code coverage of the Balancer v2 Monorepo. The Coveralls report from 8 months ago indicates a 96% code coverage, but we will not include this outdated report within this review. However, Balancer does earn itself 50% for this question due to having a solid testing suite in general.

Percentage Score Guidance:
100%
Documented full coverage
99 - 51%
Value of test coverage from documented results
50%
No indication of code coverage but clearly there is a complete set of tests
30%
Some tests evident but not complete
0%
No test for coverage seen

12. Does the protocol provide scripts and instructions to run their tests? (Y/N)

Answer: Yes

Scripts/Instructions location: https://github.com/balancer-labs/balancer-v2-monorepo#build-and-test

Score Guidance:
Yes
Scripts and/or instructions to run tests are available in the testing suite
No
Scripts and/or instructions to run tests are not available in the testing suite

13. Is there a detailed report of the protocol's test results?(%)

Answer: 100%

An in-depth report of Balancer's testing methodology is documented here.

Percentage Score Guidance:
100%
Detailed test report as described below
70%
GitHub code coverage report visible
0%
No test report evident

14. Has the protocol undergone Formal Verification? (Y/N)

Answer: Yes
Score Guidance:
Yes
Formal Verification was performed and the report is readily available
No
Formal Verification was not performed and/or the report is not readily available.

15. Were the smart contracts deployed to a testnet? (Y/N)

Answer: Yes

This protocol has been deployed to a testnet. Contracts on testnets can be verified.

Score Guidance:
Yes
Protocol has proved their tesnet usage by providing the addresses
No
Protocol has not proved their testnet usage by providing the addresses

Security

100%

This section looks at the 3rd party software audits done. It is explained in this document.

16. Is the protocol sufficiently audited? (%)

Answer: 100%

Balancer has been audited by Trail of Bits, OpenZeppelin and Certora before the protocol's v2 deployments.

Percentage Score Guidance:
100%
Multiple Audits performed before deployment and the audit findings are public and implemented or not required
90%
Single audit performed before deployment and audit findings are public and implemented or not required
70%
Audit(s) performed after deployment and no changes required. The Audit report is public.
65%
Code is forked from an already audited protocol and a changelog is provided explaining why forked code was used and what changes were made. This changelog must justify why the changes made do not affect the audit.
50%
Audit(s) performed after deployment and changes are needed but not implemented.
30%
Audit(s) performed are low-quality and do not indicate proper due diligence.
20%
No audit performed
0%
Audit Performed after deployment, existence is public, report is not public OR smart contract address' not found.
Deduct 25% if the audited code is not available for comparison.

17. Is the bounty value acceptably high (%)

Answer: 100%

This protocol offers an active bug bounty of $2.4m.

Percentage Score Guidance:
100%
Bounty is 10% TVL or at least $1M AND active program (see below)
90%
Bounty is 5% TVL or at least 500k AND active program
80%
Bounty is 5% TVL or at least 500k
70%
Bounty is 100k or over AND active program
60%
Bounty is 100k or over
50%
Bounty is 50k or over AND active program
40%
Bounty is 50k or over
20%
Bug bounty program bounty is less than 50k
0%
No bug bounty program offered / the bug bounty program is dead
An active program means that a third party (such as Immunefi) is actively driving hackers to the site. An inactive program would be static mentions on the docs.

Admin Controls

82%

This section covers the documentation of special access controls for a DeFi protocol. The admin access controls are the contracts that allow updating contracts or coefficients in the protocol. Since these contracts can allow the protocol admins to "change the rules", complete disclosure of capabilities is vital for user's transparency. It is explained in this document.

18. Is the protocol's admin control information easy to find?

Answer: 100%

Admin control information was well documented at this location. This was quick to find.

Percentage Score Guidance:
100%
Admin Controls are clearly labelled and on website, docs or repo, quick to find
70%
Admin Controls are clearly labelled and on website, docs or repo but takes a bit of looking
40%
Admin Control docs are in multiple places and not well labelled
20%
Admin Control docs are in multiple places and not labelled
0%
Admin Control information could not be found

19. Are relevant contracts clearly labelled as upgradeable or immutable? (%)

Answer: 100%

Balancer's smart contracts are identified as immutable, as identified here. As we are currently past the initial 4 months of Balance v2 contract deployments, the contracts are effectively "unstoppable" i.e. immutable. This is because the MultiSig can only interact with protocol fees and arbitrary parameters that have nothing to do with the underlying logic or execution. Either way, this MultiSig has no admin rights and cannot operate without first going through a governance vote. Paired with the fact that Balancer is absolutely non-custodial, we consider the contracts immutable.

Percentage Score Guidance:
100%
Both the contract documentation and the smart contract code state that the code is not upgradeable or immutable.
80%
All Contracts are clearly labelled as upgradeable (or not)
50%
Code is immutable but not mentioned anywhere in the documentation
0%
Admin control information could not be found

20. Is the type of smart contract ownership clearly indicated? (%)

Answer: 100%

Balancer's ownership is clearly indicated in this location.

Percentage Score Guidance:
100%
The type of ownership is clearly indicated in their documentation. (OnlyOwner / MultiSig / etc)
50%
The type of ownership is indicated, but only in the code. (OnlyOwner / MultiSig / etc)
0%
Admin Control information could not be found

21. Are the protocol's smart contract change capabilities described? (%)

Answer: 100%

Balancer's smart contract change capabilities are identified in all contracts.

Percentage Score Guidance:
100%
The documentation covers the capabilities for change for all smart contracts
50%
The documentation covers the capabilities for change in some, but not all contracts
0%
The documentation does not cover the capabilities for change in any contract

22. Is the protocol's admin control information easy to understand? (%)

Answer: 100%

This information is not in software specific language, because vault & weighted pools are now identified as immutable.

Percentage Score Guidance:
100%
All the contracts are immutable
90%
Description relates to investments safety in clear non-software language
30%
Description all in software-specific language
0%
No admin control information could be found

23. Is there sufficient Pause Control documentation? (%)

Answer: 100%

Balancer no longer uses a pause control. This is adequately explained and justified here.

Percentage Score Guidance:
100%
Pause control(s) are clearly documented and there is records of at least one test within 3 months
80%
Pause control(s) explained clearly but no evidence of regular tests
40%
Pause controls mentioned with no detail on capability or tests
0%
Pause control not documented or explained

24. Is there sufficient Timelock documentation? (%)

Answer: 30%

This protocol has limited timelock documentation which can be found at this location. Although a duration is specified, this timelock does not seem to pertain to any governance-level activities. This information is also relevant to Balancer V1, and it is unclear if it persists throughout V2 As such, we will not be awarding points for this duration. However, the presence of a timelock functionality within Balancer is clear.

Percentage Score Guidance:
100%
Documentation identifies and explains why the protocol does not need a Timelock OR Timelock documentation identifies its duration, which contracts it applies to and justifies this time period.
60%
A Timelock is identified and its duration is specified
30%
A Timelock is identified
0%
No Timelock information was documented

25. Is the Timelock of an adequate length? (Y/N)

Answer: 0%

The timelock is of a non-explained length.

Percentage Score Guidance:
100%
Timelock is between 48 hours to 1 week OR justification as to why no Timelock is needed / is outside this length.
50%
Timelock is less than 48 hours or greater than 1 week.
0%
No Timelock information was documented OR no timelock length was identified.

Oracles

100%

This section goes over the documentation that a protocol may or may not supply about their Oracle usage. Oracles are a fundamental part of DeFi as they are responsible for relaying tons of price data information to thousands of protocols using blockchain technology. Not only are they important for price feeds, but they are also an essential component of transaction verification and security. This is explained in this document.

26. Is the protocol's Oracle sufficiently documented? (%)

Answer: 100%

Balancer's oracle source, Uniswap TWAP, is fully documented at this location. In addition, contracts that use these oracles and the associated data refresh rates are identified.

Percentage Score Guidance:
100%
If it uses one, the Oracle is specified. The contracts dependent on the oracle are identified. Basic software functions are identified (if the protocol provides its own price feed data). Timeframe of price feeds are identified. OR The reason as to why the protocol does not use an Oracle is identified and explained.
75%
The Oracle documentation identifies both source and timeframe, but does not provide additional context regarding smart contracts.
50%
Only the Oracle source is identified.
0%
No oracle is named / no oracle information is documented.

27. Is front running mitigated by this protocol? (Y/N)

Answer: Yes

Balancer documents front running mitigation techniques through leveraging accumulators which is documented at this location.

Score Guidance:
Yes
The protocol cannot be front run and there is an explanation as to why OR documented front running countermeasures are implemented.
No
The Oracle documentation identifies both source and timeframe, but does not provide additional context regarding smart contracts.

28. Can flashloan attacks be applied to the protocol, and if so, are those flashloan attack risks mitigated? (Y/N)

Answer: Yes

Balancer documents no flash loan manipulation countermeasures. They justify this in identifying that flash loans are beneficial to its operation via Flash Swaps.

Score Guidance:
Yes
The protocol's documentation includes information on how they mitigate the possibilities and extents of flash loan attacks.
No
The protocol's documentation does not include any information regarding the mitigation of flash loan attacks.

Appendices

1// This program is free software: you can redistribute it and/or modify
2// it under the terms of the GNU General Public License as published by
3// the Free Software Foundation, either version 3 of the License, or
4// (at your option) any later version.
5
6// This program is distributed in the hope that it will be useful,
7// but WITHOUT ANY WARRANTY; without even the implied warranty of
8// MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE.  See the
9// GNU General Public License for more details.
10
11// You should have received a copy of the GNU General Public License
12// along with this program.  If not, see <http://www.gnu.org/licenses/>.
13
14pragma solidity 0.5.12;
15
16import "./BToken.sol";
17import "./BMath.sol";
18
19contract BPool is BBronze, BToken, BMath {
20
21    struct Record {
22        bool bound;   // is token bound to pool
23        uint index;   // private
24        uint denorm;  // denormalized weight
25        uint balance;
26    }
27
28    event LOG_SWAP(
29        address indexed caller,
30        address indexed tokenIn,
31        address indexed tokenOut,
32        uint256         tokenAmountIn,
33        uint256         tokenAmountOut
34    );
35
36    event LOG_JOIN(
37        address indexed caller,
38        address indexed tokenIn,
39        uint256         tokenAmountIn
40    );
41
42    event LOG_EXIT(
43        address indexed caller,
44        address indexed tokenOut,
45        uint256         tokenAmountOut
46    );
47
48    event LOG_CALL(
49        bytes4  indexed sig,
50        address indexed caller,
51        bytes           data
52    ) anonymous;
53
54    modifier _logs_() {
55        emit LOG_CALL(msg.sig, msg.sender, msg.data);
56        _;
57    }
58
59    modifier _lock_() {
60        require(!_mutex, "ERR_REENTRY");
61        _mutex = true;
62        _;
63        _mutex = false;
64    }
65
66    modifier _viewlock_() {
67        require(!_mutex, "ERR_REENTRY");
68        _;
69    }
70
71    bool private _mutex;
72
73    address private _factory;    // BFactory address to push token exitFee to
74    address private _controller; // has CONTROL role
75    bool private _publicSwap; // true if PUBLIC can call SWAP functions
76
77    // `setSwapFee` and `finalize` require CONTROL
78    // `finalize` sets `PUBLIC can SWAP`, `PUBLIC can JOIN`
79    uint private _swapFee;
80    bool private _finalized;
81
82    address[] private _tokens;
83    mapping(address=>Record) private  _records;
84    uint private _totalWeight;
85
86    constructor() public {
87        _controller = msg.sender;
88        _factory = msg.sender;
89        _swapFee = MIN_FEE;
90        _publicSwap = false;
91        _finalized = false;
92    }
93
94    function isPublicSwap()
95        external view
96        returns (bool)
97    {
98        return _publicSwap;
99    }
100
101    function isFinalized()
102        external view
103        returns (bool)
104    {
105        return _finalized;
106    }
107
108    function isBound(address t)
109        external view
110        returns (bool)
111    {
112        return _records[t].bound;
113    }
114
115    function getNumTokens()
116        external view
117        returns (uint) 
118    {
119        return _tokens.length;
120    }
121
122    function getCurrentTokens()
123        external view _viewlock_
124        returns (address[] memory tokens)
125    {
126        return _tokens;
127    }
128
129    function getFinalTokens()
130        external view
131        _viewlock_
132        returns (address[] memory tokens)
133    {
134        require(_finalized, "ERR_NOT_FINALIZED");
135        return _tokens;
136    }
137
138    function getDenormalizedWeight(address token)
139        external view
140        _viewlock_
141        returns (uint)
142    {
143
144        require(_records[token].bound, "ERR_NOT_BOUND");
145        return _records[token].denorm;
146    }
147
148    function getTotalDenormalizedWeight()
149        external view
150        _viewlock_
151        returns (uint)
152    {
153        return _totalWeight;
154    }
155
156    function getNormalizedWeight(address token)
157        external view
158        _viewlock_
159        returns (uint)
160    {
161
162        require(_records[token].bound, "ERR_NOT_BOUND");
163        uint denorm = _records[token].denorm;
164        return bdiv(denorm, _totalWeight);
165    }
166
167    function getBalance(address token)
168        external view
169        _viewlock_
170        returns (uint)
171    {
172
173        require(_records[token].bound, "ERR_NOT_BOUND");
174        return _records[token].balance;
175    }
176
177    function getSwapFee()
178        external view
179        _viewlock_
180        returns (uint)
181    {
182        return _swapFee;
183    }
184
185    function getController()
186        external view
187        _viewlock_
188        returns (address)
189    {
190        return _controller;
191    }
192
193    function setSwapFee(uint swapFee)
194        external
195        _logs_
196        _lock_
197    { 
198        require(!_finalized, "ERR_IS_FINALIZED");
199        require(msg.sender == _controller, "ERR_NOT_CONTROLLER");
200        require(swapFee >= MIN_FEE, "ERR_MIN_FEE");
201        require(swapFee <= MAX_FEE, "ERR_MAX_FEE");
202        _swapFee = swapFee;
203    }
204
205    function setController(address manager)
206        external
207        _logs_
208        _lock_
209    {
210        require(msg.sender == _controller, "ERR_NOT_CONTROLLER");
211        _controller = manager;
212    }
213
214    function setPublicSwap(bool public_)
215        external
216        _logs_
217        _lock_
218    {
219        require(!_finalized, "ERR_IS_FINALIZED");
220        require(msg.sender == _controller, "ERR_NOT_CONTROLLER");
221        _publicSwap = public_;
222    }
223
224    function finalize()
225        external
226        _logs_
227        _lock_
228    {
229        require(msg.sender == _controller, "ERR_NOT_CONTROLLER");
230        require(!_finalized, "ERR_IS_FINALIZED");
231        require(_tokens.length >= MIN_BOUND_TOKENS, "ERR_MIN_TOKENS");
232
233        _finalized = true;
234        _publicSwap = true;
235
236        _mintPoolShare(INIT_POOL_SUPPLY);
237        _pushPoolShare(msg.sender, INIT_POOL_SUPPLY);
238    }
N/A