AI Advisory
Strategic guidance for secure AI adoption
Prepared by:
HALBORN
Last Updated 06/29/2026
Date of Engagement: June 11th, 2026 - June 22nd, 2026
100% of all REPORTED Findings have been addressed
All findings
19
Critical
0
High
0
Medium
2
Low
8
Informational
9
Dsrv Labs engaged Halborn to conduct a security assessment on their smart contracts beginning on June 11th 2026 and ending on June 22nd, 2026. The assessment scope was limited to the smart contracts provided to Halborn. Commit hashes and additional details are available in the Scope section of this report.
The reviewed system is a smart contract monorepo consisting of four independent packages: an EIP-7702 account abstraction system with session keys and a two-phase recovery mechanism, an ERC-20 payment settlement system using Permit2 with a replaceable logic layer and a permanent spender, a permissionless ETH top-up router for keeping relayer wallets funded, and a deterministic cross-chain deployer. The recovery mechanism allows unrestricted execution of any action after the challenge period elapses, with no target, selector, or value constraints applied to the recovery batch. Trust is layered differently across modules: the smart account trusts the EOA key holder, session signers are constrained by owner-configured policies, the payment system trusts the operator for configuration and the customer for signing, and the sponsor-fund trusts only the project creator. Each package directory at the audited commit contains an acknowledged vulnerability report documenting known/acknowledged issues identified prior to this engagement, which are not included in this report.
Halborn was provided with 8 days for this engagement and assigned a full-time security engineer to assess the security of the smart contracts in scope. The assigned engineer possesses deep expertise in blockchain and smart contract security, including hands-on experience with multiple blockchain protocols.
The objective of this assessment is to:
Identify potential security vulnerabilities within the smart contracts.
Verify that the smart contract functionality operates as intended.
In summary, Halborn identified several areas for improvement to reduce the likelihood and impact of security risks, which were partially addressed by the Dsrv Labs team. The main recommendations were:
Bind the customer signature to the active logic contract address so that a rotated-in logic cannot settle against previously signed payments.
Refund unused native value to the caller after sponsored execution, or restrict the sponsored path to zero value.
Cap the number of allowed targets and selectors per policy, and replace the physical signer sweep on bulk invalidation with an epoch-only increment that defers storage cleanup to lazy access.
Halborn performed a combination of manual review of the code and automated security testing to balance efficiency, timeliness, practicality, and accuracy in regard to 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 coverage of smart contracts and 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 the architecture and purpose of the in-scope contracts.
Manual code review and walkthrough of the in-scope contracts.
Manual assessment of critical Solidity variables and functions to identify potential vulnerability classes.
Manual testing using custom scripts.
Static Analysis of security for scoped contract, and imported functions (Slither).
Local deployment and testing with (Foundry, Remix IDE).
| EXPLOITABILITY METRIC () | METRIC VALUE | NUMERICAL VALUE |
|---|---|---|
| Attack Origin (AO) | Arbitrary (AO:A) Specific (AO:S) | 1 0.2 |
| Attack Cost (AC) | Low (AC:L) Medium (AC:M) High (AC:H) | 1 0.67 0.33 |
| Attack Complexity (AX) | Low (AX:L) Medium (AX:M) High (AX:H) | 1 0.67 0.33 |
| IMPACT METRIC () | METRIC VALUE | NUMERICAL VALUE |
|---|---|---|
| Confidentiality (C) | None (C:N) Low (C:L) Medium (C:M) High (C:H) Critical (C:C) | 0 0.25 0.5 0.75 1 |
| Integrity (I) | None (I:N) Low (I:L) Medium (I:M) High (I:H) Critical (I:C) | 0 0.25 0.5 0.75 1 |
| Availability (A) | None (A:N) Low (A:L) Medium (A:M) High (A:H) Critical (A:C) | 0 0.25 0.5 0.75 1 |
| Deposit (D) | None (D:N) Low (D:L) Medium (D:M) High (D:H) Critical (D:C) | 0 0.25 0.5 0.75 1 |
| Yield (Y) | None (Y:N) Low (Y:L) Medium (Y:M) High (Y:H) Critical (Y:C) | 0 0.25 0.5 0.75 1 |
| SEVERITY COEFFICIENT () | COEFFICIENT VALUE | NUMERICAL VALUE |
|---|---|---|
| Reversibility () | None (R:N) Partial (R:P) Full (R:F) | 1 0.5 0.25 |
| Scope () | Changed (S:C) Unchanged (S:U) | 1.25 1 |
| Severity | Score Value Range |
|---|---|
| Critical | 9 - 10 |
| High | 7 - 8.9 |
| Medium | 4.5 - 6.9 |
| Low | 2 - 4.4 |
| Informational | 0 - 1.9 |
Critical
0
High
0
Medium
2
Low
8
Informational
9
| Security analysis | Risk level | Remediation Date |
|---|---|---|
| Payment signature digest does not bind to the executing logic contract | Medium | Risk Accepted - 06/26/2026 |
| Excess native ETH sent with sponsored execution is not refunded to the relayer | Medium | Solved - 06/26/2026 |
| Unbounded nested loops in session management cause gas exhaustion | Low | Risk Accepted - 06/26/2026 |
| Passkey signature verification fails on chains without the P256 precompile | Low | Risk Accepted - 06/26/2026 |
| Payment ordering within a batch enables selective budget depletion | Low | Risk Accepted - 06/26/2026 |
| External call return data is silently discarded on success | Low | Risk Accepted - 06/26/2026 |
| Signature verification view diverges from the execution path it is meant to preflight | Low | Solved - 06/26/2026 |
| Validation check can be enabled when the validation registry is not deployed | Low | Solved - 06/26/2026 |
| Batch funding scan window is consumed by ineligible sub-sponsors reducing effective coverage | Low | Risk Accepted - 06/26/2026 |
| Payer resolution does not account for transfer-blocking conditions causing settlement to revert instead of falling through | Low | Risk Accepted - 06/26/2026 |
| Admin role can be permanently renounced without safeguard | Informational | Acknowledged - 06/26/2026 |
| Agent verification hook permits multiple unconfigured states that silently bypass all checks | Informational | Solved - 06/26/2026 |
| P256 session signers can be registered without relying-party binding | Informational | Acknowledged - 06/26/2026 |
| Customer change preserves existing budgets and backup accounts for the incoming signer | Informational | Acknowledged - 06/26/2026 |
| Recovery proposal overwrite resets the challenge period without cancellation record | Informational | Solved - 06/26/2026 |
| Trusted validators can be cleared while the validation check remains enabled | Informational | Solved - 06/26/2026 |
| Admin role can escalate to operator role through intermediate role self-grant | Informational | Acknowledged - 06/26/2026 |
| Recovery cannot evict a compromised key and provides no freeze during the challenge period | Informational | Solved - 06/29/2026 |
| Backup payer allowances are spender-global and can be drained by any project without payer consent | Informational | Solved - 06/26/2026 |
//Medium
//Medium
//Low
//Low
//Low
//Low
//Low
//Low
//Low
//Low
//Informational
//Informational
//Informational
//Informational
//Informational
//Informational
//Informational
//Informational
//Informational
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.
// Download the full report
Smart Contract Assessment
* Use Google Chrome for best results
** Check "Background Graphics" in the print settings if needed
