CEP18 Audit | Casper Association | Halborn Audit Reports

Summary

100% of all REPORTED Findings have been addressed

About this report

Assessment Type

Assurance Assessment

Date of Engagement

June 23rd, 2025 - July 7th, 2025

Source Code

cep18

Assessed Commit ID

eae0263

Severity Breakdown

1Acknowledged
1Risk Accepted
5Solved
7All Findings

Critical0
High0
Medium0
Low4
- 1Risk A.
- 3Solved
Informational3
- 2Solved
- 1Ack.

Introduction#

Casper engaged Halborn to conduct a security assessment of the CEP18 contract, beginning June 23rd, 2024 and ending July 7th, 2024.

The CEP18 contract is the standard token contract within the Casper ecosystem, and the engagement aimed to verify that the Casper network Conder upgrade did not create security vulnerabilities in the updated contract.

Assessment Summary#

The team at Halborn assigned a full-time security engineer to verify the security of the smart contract. The security engineer is a blockchain and smart-contract security expert with advanced penetration testing, smart-contract hacking, and deep knowledge of multiple blockchain protocols.

The purpose of this assessment is to:

Ensure that smart contract functions operate as intended.
Identify potential security issues with the smart contracts.

In summary, Halborn identified some improvements to reduce the likelihood and impact of risks, which were mostly addressed by the Casper team. The main ones were the following:

Support the AddressableEntities feature.
Synchronize the SDK with the added entry points.
Fix the SDK entry point parameters.
Fix the SDK events support.

Test Approach and Methodology#

Halborn performed a combination of the manual view of the code and automated security testing to balance efficiency, timeliness, practicality, and accuracy regarding the scope of the smart contract assessment. While manual testing is recommended to uncover flaws in logic, process, and implementation, automated testing techniques help enhance the coverage of smart contracts. They can quickly identify items that do not follow security best practices. The following phases and associated tools were used throughout the term of the assessment:

Research into architecture, purpose, and use of the platform.
Manual code read and walk through.
Manual Assessment of use and safety for the critical Rust variables and functions in scope to identify any arithmetic related vulnerability classes.
Cross contract call controls.
Architecture related logical controls.
Test complex scenarios with unit tests.

Risk Methodology#

Every vulnerability and issue observed by Halborn is ranked based on two sets of Metrics and a Severity Coefficient. This system is inspired by the industry standard Common Vulnerability Scoring System.

The two Metric sets are: Exploitability and Impact. Exploitability captures the ease and technical means by which vulnerabilities can be exploited and Impact describes the consequences of a successful exploit.

The Severity Coefficients is designed to further refine the accuracy of the ranking with two factors: Reversibility and Scope. These capture the impact of the vulnerability on the environment as well as the number of users and smart contracts affected.

The final score is a value between 0-10 rounded up to 1 decimal place and 10 corresponding to the highest security risk. This provides an objective and accurate rating of the severity of security vulnerabilities in smart contracts.

The system is designed to assist in identifying and prioritizing vulnerabilities based on their level of risk to address the most critical issues in a timely manner.

4.1 EXPLOITABILITY

Attack Origin (AO):

Captures whether the attack requires compromising a specific account.

Attack Cost (AC):

Captures the cost of exploiting the vulnerability incurred by the attacker relative to sending a single transaction on the relevant blockchain. Includes but is not limited to financial and computational cost.

Attack Complexity (AX):

Describes the conditions beyond the attacker’s control that must exist in order to exploit the vulnerability. Includes but is not limited to macro situation, available third-party liquidity and regulatory challenges.

Metrics:

EXPLOITABILITY METRIC ( $m_e$ )	METRIC VALUE	NUMERICAL VALUE
Attack Origin (AO)	Arbitrary (AO:A)	1
Attack Origin (AO)	Specific (AO:S)	0.2
Attack Cost (AC)	Low (AC:L)	1
	Medium (AC:M)	0.67
	High (AC:H)	0.33
Attack Complexity (AX)	Low (AX:L)	1
	Medium (AX:M)	0.67
	High (AX:H)	0.33

Exploitability

E

is calculated using the following formula:

$E = \prod m_e$

4.2 IMPACT

Confidentiality (C):

Measures the impact to the confidentiality of the information resources managed by the contract due to a successfully exploited vulnerability. Confidentiality refers to limiting access to authorized users only.

Integrity (I):

Measures the impact to integrity of a successfully exploited vulnerability. Integrity refers to the trustworthiness and veracity of data stored and/or processed on-chain. Integrity impact directly affecting Deposit or Yield records is excluded.

Availability (A):

Measures the impact to the availability of the impacted component resulting from a successfully exploited vulnerability. This metric refers to smart contract features and functionality, not state. Availability impact directly affecting Deposit or Yield is excluded.

Deposit (D):

Measures the impact to the deposits made to the contract by either users or owners.

Yield (Y):

Measures the impact to the yield generated by the contract for either users or owners.

Metrics:

IMPACT METRIC ( $m_I$ )	METRIC VALUE	NUMERICAL VALUE
Confidentiality (C)	None (C:N)	0
	Low (C:L)	0.25
	Medium (C:M)	0.5
	High (C:H)	0.75
	Critical (C:C)	1
Integrity (I)	None (I:N)	0
	Low (I:L)	0.25
	Medium (I:M)	0.5
	High (I:H)	0.75
	Critical (I:C)	1
Availability (A)	None (A:N)	0
	Low (A:L)	0.25
	Medium (A:M)	0.5
	High (A:H)	0.75
	Critical (A:C)	1
Deposit (D)	None (D:N)	0
	Low (D:L)	0.25
	Medium (D:M)	0.5
	High (D:H)	0.75
	Critical (D:C)	1
Yield (Y)	None (Y:N)	0
	Low (Y:L)	0.25
	Medium (Y:M)	0.5
	High (Y:H)	0.75
	Critical (Y:C)	1

Impact

I

is calculated using the following formula:

$I = max(m_I) + \frac{\sum{m_I} - max(m_I)}{4}$

4.3 SEVERITY COEFFICIENT

Reversibility (R):

Describes the share of the exploited vulnerability effects that can be reversed. For upgradeable contracts, assume the contract private key is available.

Scope (S):

Captures whether a vulnerability in one vulnerable contract impacts resources in other contracts.

Metrics:

SEVERITY COEFFICIENT ( $C$ )	COEFFICIENT VALUE	NUMERICAL VALUE
Reversibility ( $r$ )	None (R:N)	1
	Partial (R:P)	0.5
	Full (R:F)	0.25
Scope ( $s$ )	Changed (S:C)	1.25
Scope ( $s$ )	Unchanged (S:U)	1

Severity Coefficient

C

is obtained by the following product:

$C = rs$

The Vulnerability Severity Score

S

is obtained by:

$S = min(10, EIC * 10)$

The score is rounded up to 1 decimal places.

Critical	High	Medium	Low	Informational
9 - 10	7 - 8.9	4.5 - 6.9	2 - 4.4	0 - 1.9

Scope#

(a) Repository:cep18

(b) Assessed Commit ID:eae0263d9e3c32c37350bda2caf30c56381c6d15

18 files

cep18 / contracts / contract

11 files

allowances.rs

rust

balances.rs

rust

constants.rs

rust

entry_points.rs

rust

error.rs

rust

events.rs

rust

lib.rs

rust

main.rs

rust

modalities.rs

rust

security.rs

rust

utils.rs

rust

Out-of-Scope:Economic attacks and external dependencies.

https://github.com/casper-ecosystem/cep18/pull/172

Out-of-Scope: New features/implementations after the remediation commit IDs.

Assessment Summary & Findings Overview#

#	Title	Severity	Score	Status
HAL-01	Addressable entities feature activation leads to total loss of funds	Low	3.1	Risk Accepted07/13/2025
HAL-02	SDK is missing events	Low	2.5	Solved07/13/2025
HAL-03	Missing ChangeEventsModeParams declaration in SDK	Low	2.5	Solved07/13/2025
HAL-04	Deprecated BurnerList argument in ChangeSecurityArgs	Low	2.5	Solved07/13/2025
HAL-05	Unreachable caller kinds in get_immediate_caller	Informational	0.0	Solved07/13/2025
HAL-06	Redundant sender recipient check	Informational	0.0	Acknowledged07/13/2025
HAL-07	Unused ENTRY_POINT_UPGRADE constant	Informational	0.0	Solved07/13/2025

Findings & Tech Details#

HAL-01Risk Accepted

Addressable entities feature activation leads to total loss of funds

Low

3.1AO:S/AC:L/AX:L/R:N/S:C/C:N/A:C/I:N/D:C/Y:NAO:S/AC:L/AX:L/R:N/S:C/C:N/A:C/I:N/D:C/Y:N

Description

Proof of Concept

Recommendation

https://github.com/casper-ecosystem/cep18/pull/172

Disclaimer#

Halborn strongly recommends conducting a follow-up assessment of the project either within six months or immediately following any material changes to the codebase, whichever comes first. This approach is crucial for maintaining the project’s integrity and addressing potential vulnerabilities introduced by code modifications.