# Compounding shares will overtime get less rewards than non compounding shares Medium · Three Sigma · DeFi infrastructure · 15th March 2024 Finding 3S-Clip-M01 of the Clip Finance Strategy Upgrade security review. - Protocol: https://www.clip.finance/ - Report: /reports/clip-finance-strategy-upgrade - Source: https://github.com/0xsimao/audits/blob/main/Three%20Sigma/2024-03-15-clip-finance-ii.pdf --- ### Description keepPortion and sellPortion are based on the total number of shares of each type. However, compoundShareRate is expected to increase due to accumulating rewards. This means that, for compounding shares, the same liquidity minted compared to non compounding shares will lead to less shares, when depositing. Thus, over time, assuming equal deposits of compounding and non compounding shares, the total supply of non compounding shares is expected to grow more than compounding shares. ### Recommendation keepPortion and sellPortion should be calculated based on the total liquidity of each share type, not the total supply, as liquidity is effectively what is generating rewards. ### Status Addressed in [#2464036](https://github.com/ClipFinance/StrategyRouter-private/pull/107/commits/246403632989e7540acab2238a5e40e170452de2). Disclosed by 0xSimao (https://0xsimao.com/). --- Related findings: - [Delegate rewards system is unfair to delegates with less tokens and reduces decentralization](https://0xsimao.com/findings/ajna-protocol-delegate-rewards-system-decentralization): Ajna Protocol - [Possible to mint or burn infinite shares, stealing all rewards or making transfers fail](https://0xsimao.com/findings/trestle-mint-shares-rewards-transfers): Trestle wTIA Bridge