Precision loss due to engines not using .muldiv() when calculating lp ratios

Low/InfoVertex·by the Three Sigma team·Hybrid orderbook DEX·3rd April 20243S-Vertex-L04

Description

For example, in SpotEngineState::_getInLpBalance(), the ratio is calculated first, likely incurring in precision loss as lpState.supply is expected to be bigger than 1e18 (used in .div()).

This means that baseAmount and quoteAmount will be smaller due to the precision loss.

Recommendation

Everytime a division and multiplication are to be applied and division loss could occur (when the denominator is bigger than 1e18), mulDiv() should be used. https://github.com/vertex-protocol/vertex-contracts-3sigma-audit/blob/main/contracts/SpotEngineLP.sol#L38 https://github.com/vertex-protocol/vertex-contracts-3sigma-audit/blob/main/contracts/PerpEngineState.sol#L115 https://github.com/vertex-protocol/vertex-contracts-3sigma-audit/blob/main/contracts/PerpEngine.sol#L174 https://github.com/vertex-protocol/vertex-contracts-3sigma-audit/blob/main/contracts/PerpEngine.sol#L177

Status

Acknowledged

Found during Three Sigma’s team review · 0xSimao on the review team