Three intents each pass a 40 collateral check and the maker withdraws 20 of LP funds

Source & credit. Reproduction of a public audit finding curated by AuditVault — the original finding: 45976-h-1-anyone-can-steal-all-funds-from-the-market-due-to-incorr. Standalone Foundry PoC and full write-up: 45976-h-1-anyone-can-steal-all-funds-from-the-market-due-to-incorr_exp in the evm-hack-registry mirror.

Vulnerability classes: vuln/logic/missing-check · vuln/logic/price-calculation

Key info#

Field	Value
Loss	20 collateral withdrawn above the attacker's 40 deposit. The taker account ends at -20. The LP is left with 40 of 60
Vulnerable contract	`Market.validate`
Attacker EOA	`0x1111111111111111111111111111111111111111`
Attack contract	`Exploit`
Attack tx	`Exploit.run()`
Chain / block / date	Ethereum model · block 0 · 2025-01
Compiler	solc 0.8.27, cancun, via IR
Bug class	Health adds only the current intent's price gap

TL;DR#

validate sets health to collateral + amount * (oraclePrice - intentPrice). It does not add pnl from intents already pending on that account. A taker with 40 collateral can submit three size-1 intents at 120 while the oracle is 100. Each check sees 40 - 20. Settlement applies all three and the taker goes to -20. The maker, the same attacker, withdraws 60. Net gain is 20, taken from the LP's 60. Summing pending pnl makes the third intent revert.

Background#

Sherlock's January 2025 Perennial V2 update contest, issue 28 (H-1), reported by panprog. Opening a position from an intent realizes pnl from the difference between the user-chosen intent price and the oracle. InvariantLib.validate adjusts collateral for the current guarantee only. The report's trace shows the taker collateral going negative while the counterparty collateral exceeds the deposits.

The vulnerable code#

SOLIDITY

int256 pnl = amount * (oraclePrice - price) / 1 ether;
// @> VULN: health adds only this intent's price gap and ignores every other pending intent
health = collateral[account] + pnl;
require(health >= 0, "health");

submit calls this before pushing the intent. settle later applies every pending intent.

Root cause#

Pending intents are invisible to the health check. The collateral word still shows the deposit, so each new intent is judged as if it were the only one.

Preconditions#

Oracle price is 100. Each intent is size 1 at price 120, so each taker pnl is -20.
The taker deposits 40. An LP already has 60 in the market.
The maker is a second account controlled by the attacker. All three submits happen before settlement.

Attack walkthrough#

The taker deposits 40.
validate returns 20 for one intent. The same check passes for the second and third.
settle adds -20 three times. Taker collateral is -20. Maker collateral is 60.
withdraw pays the maker 60. The attacker started the call with 40 and ends with 60.

Diagrams#

flowchart TD A["Taker deposits 40 and LP already holds 60"] --> B["Each intent prices 20 below the oracle"] B --> C["VULN health is 40 minus only this intent"] C --> D["Three intents are accepted"] D --> E["Settlement leaves the taker at -20"] E --> F["Maker withdraws 60 and keeps 20 of LP funds"] C --> G["Control adds the pending pnl"] G --> H["Control reverts the third intent"]

Impact#

The attacker deposits 40 and withdraws 60 in the same call. The extra 20 is the LP's collateral. The taker account is -20 and is not required to cover it before the maker is paid. The fixed health check adds the pending gaps, so the third intent reverts and the market still holds 100.

Remediation#

Sum the price adjustments of every pending intent on the account and add that sum to collateral inside validate, which is the mitigation in the report.

How to reproduce#

BASH

cd 45976-h-1-anyone-can-steal-all-funds-from-the-market-due-to-incorr_exp
forge test -vv

test_exploit_three_intents_withdraw_20_of_lp_collateral asserts a 60 withdrawal, a -20 taker, and 40 left of the LP's 60. test_control_third_intent_fails_the_summed_health_check asserts the third submit reverts and the market still holds 100. Captured output is output.txt.

Sources#

AuditVault finding: https://github.com/Auditware/AuditVault/blob/main/findings/45976-h-1-anyone-can-steal-all-funds-from-the-market-due-to-incorr.md
Sherlock judging issue 28: https://github.com/sherlock-audit/2025-01-perennial-v2-4-update-judging/issues/28
Fix: https://github.com/equilibria-xyz/perennial-v2/pull/553

Sources & further analysis#

Reproductions & code

Standalone PoC + full trace: 45976-h-1-anyone-can-steal-all-funds-from-the-market-due-to-incorr_exp (evm-hack-registry mirror).
AuditVault finding: 45976-h-1-anyone-can-steal-all-funds-from-the-market-due-to-incorr.

Alerts & third-party analyses

Web3Sec X hacked database: search.
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Solodit incident search: search.

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