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Synthetix

97%

Process Quality Review (0.8)

Synthetix

Final score:97%
Date:25 May 2022
Audit Process:version 0.8
Author:Lena
PQR Score:97%

PASS

Protocol Website:http://synthetix.io

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
Ethereum
#QuestionAnswer
100%
1.100%
2.100%
3.Yes
4.100%
5.100
100%
6.Yes
7.Yes
8.100%
9.100%
99%
10.100%
11.95%
12.Yes
13.100%
14.Yes
15.Yes
96%
16.100%
17.70%
93%
18.100%
19.80%
20.100%
21.100%
22.90%
23.80%
24.100%
25.100%
100%
26.100%
27.Yes
28.Yes
Total:97%

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%

All smart contract addresses can be found here. They have a dedicated subsection in the documentation and were quite easy to find.

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 Proxy sUSD (Synth) is used an average over 10 times a day, as indicated here.

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

Synthetix has a public software repository at 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%

This protocol has a robust development history at 4,438 commits and 279 branches.

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

Synthetix LinkedIn features 28 employees.

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%

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.synthetix.io/litepaper/

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

Answer: Yes

This protocol's software architecture is extensively documented here.

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 100% coverage of deployed contracts by software function documentation.

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 100% traceability between software documentation and implemented code. Synthetix links each documented smart contract to its respective location in 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

99%

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 374% 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: 95%
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/Synthetixio/synthetix-scripts

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%

Synthetix has a very detailed "Actions" repository in their GitHub that includes regular Slither test logs, CodeQL logs, and (outdated) CI.

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

Synthetix has undergone formal verification. Report can be found here.

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

Synthetix has 100% been deployed to a testnet.

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

96%

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

16. Is the protocol sufficiently audited? (%)

Answer: 100%

Synthetix has been audited 20+ times, both before and after deployment. Audit history can be found here.

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: 70%

Synthetix offers an active bug bounty of $100k with Immunefi.

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

93%

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%

Synthetix' admin control information was documented at this location. This was quick to find. In addition, Synthetix further breaks down this governance architecture in their documentation..

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: 80%

Synthetix' relevant contracts (Synthetix, FeePool, Synths) are identified as upgradeable via its Proxy structure, as identified here.

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%

Ownership via a MultiSig 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%

Synthetix mentions that the Proxy contract allows for state upgrades in their key smart contracts. The protocol further explains change capabilities as being essentially limitless. However, each change must go through a rigorous voting process.

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: 90%

Synthetix very clearly details admin control information in user-friendly language.

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: 80%

Synthetix's pause control is documented and explained in this location. The author explains that the introduction of pause control will be iterated and tested regularly. However, no "fire drill" was visibly recorded in the past 3 months.

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: 100%

Synthetix no longer uses timelocks, as described here. However, each improvement proposal has to go through a voting period as well as an implementation period which both require MultiSig votes. As such, the second MultiSig vote for implementation following the proposal approval vote essentially acts as the two-factor verification process that a timelock typically offers, since there are no other ways to upgrade the protocol. Furthermore, implementation can be further delayed in the event of an emergency, but this must also be voted upon by the MultiSig.

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: 100%

There are no clear voting period lengths described, but the DAO's respective snapshots seem to indicate that each enacted proposal takes around a week to implement.

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. These questions are explained in this document.

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

Answer: 100%

The protocol's oracle source is Chainlink documented at this location. In addition, all synthetic tokens covered by these oracles are identified here, and data refresh rate is provided for each one.

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

Synthetix documents all front running mitigation techniques 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

Flash loans are not applicable for Synthetix's synthetic assets. In addition, SNX could theoretically be flash loaned, but the only use case for those tokens would be to stake them. Since staked tokens enter a 7-day burn period, potential for flash loan manipulations is effectively mitigated.

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

1pragma solidity ^0.5.16;
2
3pragma experimental ABIEncoderV2;
4
5import "openzeppelin-solidity-2.3.0/contracts/token/ERC20/SafeERC20.sol";
6
7// Inheritance
8import "./Owned.sol";
9import "./MixinSystemSettings.sol";
10import "./interfaces/ICollateralLoan.sol";
11
12// Libraries
13import "./SafeDecimalMath.sol";
14
15// Internal references
16import "./interfaces/ICollateralUtil.sol";
17import "./interfaces/ICollateralManager.sol";
18import "./interfaces/ISystemStatus.sol";
19import "./interfaces/IFeePool.sol";
20import "./interfaces/IIssuer.sol";
21import "./interfaces/ISynth.sol";
22import "./interfaces/IExchangeRates.sol";
23import "./interfaces/IExchanger.sol";
24import "./interfaces/IShortingRewards.sol";
25
26contract Collateral is ICollateralLoan, Owned, MixinSystemSettings {
27    /* ========== LIBRARIES ========== */
28    using SafeMath for uint;
29    using SafeDecimalMath for uint;
30    using SafeERC20 for IERC20;
31
32    /* ========== CONSTANTS ========== */
33
34    bytes32 private constant sUSD = "sUSD";
35
36    // ========== STATE VARIABLES ==========
37
38    // The synth corresponding to the collateral.
39    bytes32 public collateralKey;
40
41    // Stores open loans.
42    mapping(uint => Loan) public loans;
43
44    ICollateralManager public manager;
45
46    // The synths that this contract can issue.
47    bytes32[] public synths;
48
49    // Map from currency key to synth contract name.
50    mapping(bytes32 => bytes32) public synthsByKey;
51
52    // Map from currency key to the shorting rewards contract
53    mapping(bytes32 => address) public shortingRewards;
54
55    // ========== SETTER STATE VARIABLES ==========
56
57    // The minimum collateral ratio required to avoid liquidation.
58    uint public minCratio;
59
60    // The minimum amount of collateral to create a loan.
61    uint public minCollateral;
62
63    // The fee charged for issuing a loan.
64    uint public issueFeeRate;
65
66    bool public canOpenLoans = true;
67
68    /* ========== ADDRESS RESOLVER CONFIGURATION ========== */
69
70    bytes32 private constant CONTRACT_SYSTEMSTATUS = "SystemStatus";
71    bytes32 private constant CONTRACT_EXRATES = "ExchangeRates";
72    bytes32 private constant CONTRACT_EXCHANGER = "Exchanger";
73    bytes32 private constant CONTRACT_FEEPOOL = "FeePool";
74    bytes32 private constant CONTRACT_SYNTHSUSD = "SynthsUSD";
75    bytes32 private constant CONTRACT_COLLATERALUTIL = "CollateralUtil";
76
77    /* ========== CONSTRUCTOR ========== */
78
79    constructor(
80        address _owner,
81        ICollateralManager _manager,
82        address _resolver,
83        bytes32 _collateralKey,
84        uint _minCratio,
85        uint _minCollateral
86    ) public Owned(_owner) MixinSystemSettings(_resolver) {
87        manager = _manager;
88        collateralKey = _collateralKey;
89        minCratio = _minCratio;
90        minCollateral = _minCollateral;
91    }
92
93    /* ========== VIEWS ========== */
94
95    function resolverAddressesRequired() public view returns (bytes32[] memory addresses) {
96        bytes32[] memory existingAddresses = MixinSystemSettings.resolverAddressesRequired();
97        bytes32[] memory newAddresses = new bytes32[](6);
98        newAddresses[0] = CONTRACT_FEEPOOL;
99        newAddresses[1] = CONTRACT_EXRATES;
100        newAddresses[2] = CONTRACT_EXCHANGER;
N/A