Possible to improve the the liquidity add calculations

[DeFiFoFum]

Secure3 Audit - Issue 47 Acknowledged

description

The _zap function uses 50:50 split of amountIn of tokenIn to supply to the uniswap v2 pool. This is highly unefficient strategy. In this strategy, there are also chances of unutilized assets remaining in user's balance.

Two major problems arise when swapping from one asset to another:

Swap fee (0.3% for Uniswap) - With swap fee, the user receives slightly less amount of the swap out asset.

The new reserve's asset ratio - The swap alters the reserve ratio, increasing the amount of supplied asset and decreasing the amount of the withdrawn asset.
Thus, the optimal swap amount needs to take into account these issues. In this article, they explored formula (with proofs!) to solve the optimal swap amount for supplying one-sided liquidity.

For further context, zapper also used the formula mentioned in the above article for depositing single sided liquidity in uniswap v2 pools.

recommendation
Consider using the formula proved in above article to zap into uniswap v2 pools efficiently.

locations

code/contracts/SoulZap_UniV2.sol#L272-L273
code/contracts/SoulZap_UniV2.sol#L281-L307
severity
Medium

category
Logical

secure3_internal_use
updated_at: 2023-11-30 14:02:36
html_url: https://github.com/Secure3Audit/review_Apebond/issues/39