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1Inch Token Smart Contracts Audit

tags: 1Inch

Introduction

General Provisions

1inch is a DeFi aggregator and a decentralized exchange with smart routing. The core protocol connects a large number of decentralized and centralized platforms in order to minimize price slippage and find the optimal trade for the users. 1inch platform provides a variety of features in addition to swaps. Users can trade via limit orders, deposit funds into lending protocols, move coins between different liquidity pools, and this list expands constantly.

Scope of the Audit

The scope of the audit includes the following smart contracts at:

The audited commit identifier: 99fd056f91005ca521a02a005f7bcd8f77e06afc

Executive summary

The audited contract is a standard ERC-20 token with an additional permit method that implements EIP-712. This improvement allows users to sign allowance for token spending without a transaction. In other words, a spender can issue a signed allowance and provide it by an off-chain to another spender or any other user, then this allowance can be applied without the participation of the original sender and it will not spend any gas from his account.

Security Assessment Principles

Classification of Issues

  • CRITICAL: Bugs leading to Ether or token theft, fund access locking or any other loss of Ether/tokens to be transferred to any party (for example, dividends).

  • MAJOR: Bugs that can trigger a contract failure. Further recovery is possible only by manual modification of the contract state or replacement.

  • WARNINGS: Bugs that can break the intended contract logic or expose it to DoS attacks.

  • COMMENTS: Other issues and recommendations reported to/ acknowledged by the team.

Security Assessment Methodology

Two auditors independently verified the code.

Stages of the audit were as follows:

  • "Blind" manual check of the code and its model
  • "Guided" manual code review
  • Checking the code compliance with the customer requirements
  • Discussion of independent audit results
  • Report preparation

Report

CRITICAL

Not found

MAJOR

Not found

WARNINGS

1. Potential front running attack or losing of allowance

Description

At the line https://github.com/1inch-exchange/1inch-token/blob/99fd056f91005ca521a02a005f7bcd8f77e06afc/contracts/ERC20Permit.sol#L53 _approve method replaces the allowance, so there are two potential problems here:

  1. If a signer wants to increase the allowance from A to B, a receiver may withdraw A+B using the front-running attack.
  2. If a signer wants to send A and B, but a receiver forgot to withdraw A, the receiver will lose ability to withdraw A.
Recommendation

We suggest to add permitIncrease, permitDecrease methods and use it instead of the permit.

Status

Acknowledged

COMMENTS

1. Mismatch of argument name in _PERMIT_TYPEHASH and permit function

Description

At the line https://github.com/1inch-exchange/1inch-token/blob/99fd056f91005ca521a02a005f7bcd8f77e06afc/contracts/ERC20Permit.sol#L27 the value argument is used but at the line https://github.com/1inch-exchange/1inch-token/blob/99fd056f91005ca521a02a005f7bcd8f77e06afc/contracts/ERC20Permit.sol#L32 the argument name is amount.

Recommendation

We suggest to rename amount to value in the permit function.

Status

Fixed at https://github.com/1inch-exchange/1inch-token/commit/5332caa9b91403a022e74b49c9d0fc9c6d5419f4

Client's commentary

Created PR at OpenZeppelin's repo: OpenZeppelin/openzeppelin-contracts#2445

CONCLUSION

The smart contract has been audited and no critical and major issues have been found. The contract massively uses libraries from a widely known OpenZeppelin set of contracts which are safe and of high quality. All spotted issues are minor and the contract itself assumed as safe to use according to our security criteria.

For the following files from the scope only consistency with their original copies from openzeppelin repository is checked (used commit: ecc66719bd7681ed4eb8bf406f89a7408569ba9b):

Findings list

Level Amount
CRITICAL -
MAJOR -
WARNING 1
COMMENT 1

Final commit identifier with all fixes: 5332caa9b91403a022e74b49c9d0fc9c6d5419f4