Summary
The most critical subjects covered in our audit are liquidation rewards, functional correctness and precision of arithmetic operations.
Security regarding liquidation incentives is high, an unexpected peculiarity was identified where the system can incentivize liquidators to perform multiple partial liquidations instead of a single full liquidation (see Multiple partial Liquidations can result in higher than expected discount). Security regarding functional correctness and arithmetic precision are also high.
The general subjects covered are liveness, solvency, and access control. Security regarding all theaforementioned subjects is high.
During the review by ChainSecurity, issues identified by other concurrent auditors were disclosed before they could be found by ChainSecurity. Those issues are not included in the report, and we are unable to tell whether they would have been found or not.
In summary, we find that the codebase provides a high level of security.
It is important to note that security audits are time-boxed and cannot uncover all vulnerabilities. They complement but don't replace other vital measures to secure a project.
About Euler Vault Kit
Euler implements Euler Vault Kit, a system for building lending vaults where lenders can earn interest on their deposited assets and borrowers can borrow the deposited assets against collateral. The system is designed to be modular, allowing the creation of lending markets with flexible configurations.
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Euler v2 is a modular lending platform with two main components at launch: 1) the Euler Vault Kit (EVK), which empowers builders to deploy and chain together their own customised lending vaults in a permissionless manner; and 2) the Ethereum Vault Connector (EVC), a powerful, immutable, primitive which give vaults superpowers by allowing their use as collateral for other vaults. Together, the EVK and EVC provide the flexibility to build or recreate any type of pre-existing or future-state lending product inside the Euler ecosystem.
ChainSecurity delivered an exceptional audit for our project. Their meticulous approach and quick responsiveness enhanced our security and provided crucial insights. We greatly appreciate their dedication and excellent communication throughout the process.
Erik Arfvidson, Head of Cybersecurity, Euler Finance