EtherCamp’s decentralized startup team public code audit

Following our audits of the HackerGold (HKG) token and the ProjectKudos contract, we’ve been asked by the EtherCamp team to review their decentralized startup team contract.

The audited contracts can be found in the master branch of their GitHub repo, specifically, commit 6d4097a08669c2520e0d5bab317b60f1d13df44e. Main contract file is DSTContract.sol.


collectedEther subject to manipulation

Line 159 of DSTContract.sol isn’t considering the fact that collectedEther can actually need to be increased by a smaller amount than msg.value. This is due to the change return mechanism in lines 144–151. If that branch of code is executed, collected ether in that transaction should be smaller than msg.value (should be msg.value – retEther).

This allows an attacker to send a transaction with a big ether amount, receive the extra value back, and make collectedEther to be much bigger than the contract’s real balance. If the ether value sent is big enough, the attacker can then circumvent the 20% limit on ether proposals because collectedEther can be made, for example, 5 times the contract’s balance.

Fix this problem by changing that line to:

collectedEther += msg.value — retEther;

EDIT: Commit with fix:

issuePreferedTokens vulnerable to multiple calls

If issuePrefered is called twice, the second time line 208 is executed, the old value of allowed[this][virtualExchangeAddress] will be overwritten.

EDIT: Commit with fix:

Potential problems

Use safe math

There are many unchecked math operations in the code. We couldn’t find any related attack vectors on the DSTContract, but it’s always better to be safe and perform checked operations. Consider using a safe math library, or performing pre-condition checks on any math operation.

The fact that HKG supply is limited to 4,000,000 ether (and thus at most 800,000,000 HKG assuming all tokens are created at the best possible price) helps prevent possible overflows.

Use latest version of Solidity

Current code is written for old versions of solc (0.4.2). With the latest storage overwriting vulnerability found on versions of solc prior to 0.4.4, there’s a risk this code can be compiled with vulnerable versions. We recommend changing the solidity version pragma for the latest version (pragma solidity ^0.4.6;) to enforce latest compiler version to be used.

Timestamp usage

The code uses timestamps for contract logic. There’s a problem with using timestamps and now (alias for block.timestamp) for contract logic, based on the fact that miners can perform some manipulation. In general, it’s better not to rely on timestamps for contract logic. The solutions is to use block.number instead, and approximate dates with expected block heights.

Given the nature of the contract, we think the risk of miner manipulation is really low. We recommend the EtherCamp team to consider the potential risk and switch to block.number if necessary.

For more info on this topic, see this stack exchange question.

Be careful with small transactions

Transactions executing the fallback function with amounts smaller than 1 finney will assign zero tokens to the sender. Same problem happened with HackerGold.sol and was fixed in that case. We recommend doing the same for DSTContract.sol. Same for the reverse operation.

General code quality

Code quality of the DSTContract is low, which made auditing it hard. We recommend a refactor to improve code quality (more recommendations given next). Simpler code makes functionality more apparent and reduces attack surface. Given the high degree of test coverage, making changes to improve code quality will have a very low risk of introducing regressions.

Code too long and complex

DSTContract code is too long and complex. Security comes from a match between developer intention and what the code actually does. This is very hard to verify, especially if the code is huge and messy. That’s why it’s important to write simple and modular code. 700+ lines-of-code files like DSTContract.sol are not recommended.

The contract could be modularized in a parent contract that handles executive auth and ImpeachmentProposals, and the rest of the code, at least.

Remove duplicate code

Duplicate code makes it harder to understand the code’s intention and thus, auditing the code correctly. It also increases the risk of introducing hidden bugs when modifying one of the copies of some code and not the others. We recommend the following to remove duplicate code:

Remove unnecessary code

Use of send

Use of send is always risky and should be analyzed in detail. Three occurrences found in line 150, line 495, and line 520 of DSTContract.sol.
Always check send return value: Line 150: OK, line 495: warning, return value not checked! line 520: warning, return value not checked.
Consider calling send at the end of the function: Line 150: warning, code executed after send. Line 495: warning, code executed after send. Line 520: warning, code executed after send.
Favor pull payments over push payments: Warning. All lines use push payments. Consider using pull payments.

Lines 495 and 520 are guarded by the onlyExecutive function modifier, so only the executive address can cause problems. In line 150, we haven’t identified any exploitable attacks that abuse these anti-patterns.


Usage of magic constants

There are several magic constants in the contract code. Some examples are:

Use of magic constants reduces code readability and makes it harder to understand code intention. We recommend extracting magic constants into contract constants.

Additional Information and notes


Two severe security issues were found. These should be fixed as soon as possible (EDIT: done). Some additional changes were recommended to follow best practices and reduce potential attack surface.

EDIT: EtherCamp followed many of our recommendations and fixed the code based on our comments, on these commits.

Note that as of the date of publishing, the above review reflects the current understanding of known security patterns as they relate to decentralized startup team contract. We have not reviewed the related Virtual Accelerator project. The above should not be construed as investment advice or an offering of tokens. For general information about smart contract security, check out our thoughts here.