Beraborrow Managed Dens audit

A private security review of Beraborrow (CDP stablecoin), conducted with Sherlock and completed on 25th April 2025 over 6 days. 0xSimao disclosed 19 findings: 1 high severity, 8 medium and 10 low.

What Beraborrow is

Beraborrow is a CDP stablecoin on Berachain: NECT is minted against collateral held in dens, and managed leveraged vaults open, lever and unwind those positions on depositors' behalf, with withdrawals settling through epoch-based queues against what the vault actually holds.

Scope

The Sherlock review covered the blockend repository's managed-den machinery: deposit and withdrawal flows with their slippage controls, the epoch accounting that matches exiting depositors to unwound debt, leverage adjustments, and the ICR checks that keep a managed den solvent through partial exits.

High severity findings

• Lost withdrawals due to ManagedLeveragedVault::openDen() using all asset() balance

Medium severity findings

• ManagedLeveragedVault.sol::deposit() is missing slippage control
• DoSed withdrawals due to ManagedLeveragedVault::executeWithdrawalEpoch() repaying debt above limit
• ManagedLeveragedVault::executeWithdrawalEpoch() will never work because cd.prevICR is not set
• ManagedLeveragedVault::increaseLeverage() fails when the debt is closed to the limit
• ManagedLeveragedVault::decreaseLeverage() will not work when it goes below the minimum debt
• Protocol will need to donate minimum debt for all new ManagedLeveragedVaults
• Missing several safeERC20 functions
• ManagedLeveragedVault::executeWithdrawalEpoch() incorrect ICR and DoSed withdrawals due to not accouting for fees

Low severity findings

• Unused/useless code
• Hints on withdrawal may fail as the ICR changes between claiming collateral surplus and repaying debt
• ManagedLeveragedVault::deposit() slippage control on collVaultShares is not intuitive
• Incorrect ERC4626ExceededMaxRedeem event on ManagedLeveragedVault.sol:: cancelWithdrawalIntent()
• ManagedLeveragedVault::increaseLeverage() will never work in Recovery mode
• ManagedLeveragedVault::getAvailableDebt() used in ManagedLeveragedVault::increaseLeverage() is incorrect
• ManagedLeveragedVault::donateCollateral() is missing a slippage check
• Some view functions will not work under certain conditions
• ManagedLeveragedVault::getDebtToUnwindAndCollRequested() is inaccurate when there are surplus tokens
• Most ManagedLeveragedVault functions are DoSed due to bad debt check

The report

Download report (PDF)