MPC/Threshold Cryptography - Holonym

Prepared by:

HALBORN

Last Updated 09/16/2025

Date of Engagement: August 26th, 2024 - September 20th, 2024

Summary

100% of all REPORTED Findings have been addressed

All findings

Critical

High

Medium

Low

Informational

1. Introduction
2. Assessment summary
3. Test approach and methodology
4. Risk methodology
5. Scope
6. Assessment summary & findings overview
7. Findings & Tech Details

7.1 Unrestricted growth of pubkeyshares hashmap can lead to out-of-memory (oom)
7.2 Message::forwardmulrequest potential ddos
7.3 Inadequate validation of messages in dkg protocol
7.4 Deadlock in dkg
7.5 Lack of validation for threshold parameters in update_threshold function
7.6 Incorrect threshold check for multiplication verification in process_verification function
7.7 Incomplete election state update and lack of error handling in conduct_election function
7.8 Panic in polynomial generation from seed
7.9 Out-of-bounds access due to empty vectors
7.10 Missing t,n validation in network initialization
7.11 Non-constant time cryptographic operations in pointtrait
7.12 Missing error handling for encode() in process_verification function
7.13 Lack of i/o lock for file operations in storekeyshares handling
7.14 Missing synchronization for shared state in electionenginestate
7.15 Insecure rng for polynomial coefficients
7.16 Sensitive data exposure through logging of seed value
7.17 Misconfigurations in gossip initialization
7.18 Lack of peer blacklisting in gossipsub engine
7.19 Unchecked return values in request and subscription handlers
7.20 Insufficient error handling in handle_store_reshared_received_pubshare
7.21 Missing update of total nodes in add_node function
7.22 Multiple overflows in polynomial operations
7.23 Invalid threshold calculation in calculate_threshold function
7.24 Function naming and state update issue in check_election_status
7.25 Missing degree constraints in polynomial creation function
7.26 Insecure fallback to local random number generation
7.27 Use of non-cryptographically secure random number generators in dkg nodes

8. Automated Testing

1. Introduction

Holonym engaged Halborn to perform a security assessment of their Rust codebase from September 2, 2024, to September 27, 2024. The assessment focused on the specific crates listed in the provided GitHub repository and included relevant commit hashes. More details can be found in the Scope section of this report.

2. Assessment Summary

The Halborn team was allocated four weeks for the engagement and assigned a full-time security engineer to assess the security of the crates and the overall codebase. The security engineer is an expert in blockchain and smart contract security, with advanced skills in penetration testing and smart contract auditing, as well as extensive knowledge of various blockchain protocols.

The purpose of this assessment is to:

Ensure that codebase functions operate as intended
Identify potential security issues within codebase

3. 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 codebase assessment. While manual testing is recommended to uncover flaws in logic, process, and implementation, automated testing techniques. 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 on the architecture, purpose, and usage of the Human network.
Manual code reading and walkthroughs to gain an understanding of the overall design and potential vulnerabilities.
Manual assessment of critical Rust variables and functions to identify arithmetic-related vulnerabilities.
Testing for race conditions and thread safety in the Rust actor framework.
Audit of the DKG (Distributed Key Generation) cryptographic protocol to ensure robustness against potential attacks.
Review of libp2p configuration and security to validate network communication integrity.
Security testing of cryptographic primitives to ensure they meet industry standards.
Scanning Rust files for vulnerabilities using Cargo Audit, identifying outdated dependencies and known security issues.
Checking for unsafe code usage with Cargo Geiger to minimize risks associated with unsafe Rust features.
Analysis of node communication and message integrity to mitigate risks from malicious nodes.
Review of error handling and logging practices to ensure sensitive information is not exposed.
Testing for denial-of-service vulnerabilities and resilience against resource exhaustion attacks.

4. 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) 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

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) 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

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) Partial (R:P) Full (R:F)	1 0.5 0.25
Scope ( $s$ )	Changed (S:C) Unchanged (S:U)	1.25 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.

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

5. SCOPE

REPOSITORY

(a) Repository: decentralization

(b) Assessed Commit ID: 518213f

./actors/src/actor_manager.rs
./actors/src/election_actor.rs
./actors/src/lib.rs

↓ Expand ↓

Remediation Commit ID:

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

6. Assessment Summary & Findings Overview

Critical

High

Medium

Low

Informational

Security analysis	Risk level	Remediation Date
Unrestricted Growth of PubkeyShares HashMap Can Lead to Out-of-Memory (OOM)	Critical	Solved - 03/08/2025
Message::ForwardMulRequest Potential DDoS	Critical	Solved - 06/04/2025
Inadequate Validation of Messages in DKG Protocol	Critical	Solved - 03/08/2025
Deadlock in DKG	Critical	Solved - 03/08/2025
Lack of Validation for Threshold Parameters in update_threshold Function	High	Solved - 02/13/2025
Incorrect Threshold Check for Multiplication Verification in process_verification Function	Medium	Solved - 03/08/2025
Incomplete Election State Update and Lack of Error Handling in conduct_election Function	Medium	Not Applicable - 03/08/2025
Panic in Polynomial Generation from Seed	Medium	Solved - 06/11/2025
Out-of-Bounds Access Due to Empty Vectors	Medium	Not Applicable - 03/08/2025
Missing t,n Validation in Network Initialization	Medium	Solved - 03/08/2025
Non-Constant Time Cryptographic Operations In PointTrait	Low	Not Applicable - 03/08/2025
Missing Error Handling for encode() in process_verification Function	Low	Not Applicable - 03/08/2025
Lack of I/O Lock for File Operations in StoreKeyShares Handling	Low	Not Applicable - 03/08/2025
Missing Synchronization for Shared State in ElectionEngineState	Low	Not Applicable - 03/08/2025
Insecure RNG for Polynomial Coefficients	Low	Not Applicable - 03/08/2025
Sensitive Data Exposure Through Logging of Seed Value	Low	Solved - 10/10/2024
Misconfigurations in gossip Initialization	Low	Solved - 03/08/2025
Lack of Peer Blacklisting in Gossipsub Engine	Low	Solved - 03/08/2025
Unchecked Return Values in Request and Subscription Handlers	Low	Not Applicable - 03/08/2025
Insufficient Error Handling in handle_store_reshared_received_pubshare	Low	Solved - 06/04/2025
Missing Update of Total Nodes in add_node Function	Low	Not Applicable - 03/08/2025
Multiple Overflows in Polynomial Operations	Low	Not Applicable - 03/08/2025
Invalid Threshold Calculation in calculate_threshold Function	Informational	Not Applicable - 03/08/2025
Function Naming and State Update Issue in check_election_status	Informational	Not Applicable - 03/08/2025
Missing Degree Constraints in Polynomial Creation Function	Informational	Solved - 06/01/2025
Insecure Fallback to Local Random Number Generation	Informational	Not Applicable - 03/08/2025
Use of Non-Cryptographically Secure Random Number Generators in dkg nodes	Informational	Not Applicable - 03/08/2025

7. Findings & Tech Details

7.1 Unrestricted Growth of PubkeyShares HashMap Can Lead to Out-of-Memory (OOM)

Critical

Description

BVSS

AO:A/AC:L/AX:L/R:N/S:U/C:N/A:C/I:N/D:N/Y:N (10.0)

Recommendation

Remediation Comment

7.2 Message::ForwardMulRequest Potential DDoS

Critical

Description

BVSS

AO:A/AC:L/AX:L/R:N/S:U/C:N/A:C/I:N/D:N/Y:N (10.0)

Recommendation

Remediation Comment

Recommendation

Remediation Comment

Remediation Hash

https://github.com/holonym-foundation/decentralization/commit/75df6a4f13ba4c9a549559d5064d498fb3e19579

7.6 Incorrect Threshold Check for Multiplication Verification in process_verification Function

Medium

Description

BVSS

AO:A/AC:L/AX:L/R:N/S:U/C:M/A:N/I:N/D:N/Y:N (5.0)

Recommendation

Remediation Comment

7.7 Incomplete Election State Update and Lack of Error Handling in conduct_election Function

Medium

Description

BVSS

AO:A/AC:L/AX:L/R:N/S:U/C:M/A:N/I:N/D:N/Y:N (5.0)

Recommendation

Remediation Comment

7.8 Panic in Polynomial Generation from Seed

Medium

Description

Proof of Concept

BVSS

AO:A/AC:L/AX:L/R:N/S:U/C:N/A:M/I:N/D:N/Y:N (5.0)

Recommendation

Remediation Comment

Recommendation

Remediation Comment

Recommendation

Remediation Comment

Recommendation

Remediation Comment

Remediation Hash

https://github.com/holonym-foundation/decentralization/blob/fix-audit/mishti/crates/cryptography/src/polynomial.rs#L40_L53

7.26 Insecure Fallback to Local Random Number Generation

Informational

Description

Score

(0.0)

Recommendation

Remediation Comment

7.27 Use of Non-Cryptographically Secure Random Number Generators in dkg nodes

Informational

Description

Score

(0.0)

Recommendation

Remediation Comment

8. Automated Testing

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.

1. Introduction
2. Assessment summary
3. Test approach and methodology
4. Risk methodology
5. Scope
6. Assessment summary & findings overview
7. Findings & Tech Details

7.1 Unrestricted growth of pubkeyshares hashmap can lead to out-of-memory (oom)
7.2 Message::forwardmulrequest potential ddos
7.3 Inadequate validation of messages in dkg protocol
7.4 Deadlock in dkg
7.5 Lack of validation for threshold parameters in update_threshold function
7.6 Incorrect threshold check for multiplication verification in process_verification function
7.7 Incomplete election state update and lack of error handling in conduct_election function
7.8 Panic in polynomial generation from seed
7.9 Out-of-bounds access due to empty vectors
7.10 Missing t,n validation in network initialization
7.11 Non-constant time cryptographic operations in pointtrait
7.12 Missing error handling for encode() in process_verification function
7.13 Lack of i/o lock for file operations in storekeyshares handling
7.14 Missing synchronization for shared state in electionenginestate
7.15 Insecure rng for polynomial coefficients
7.16 Sensitive data exposure through logging of seed value
7.17 Misconfigurations in gossip initialization
7.18 Lack of peer blacklisting in gossipsub engine
7.19 Unchecked return values in request and subscription handlers
7.20 Insufficient error handling in handle_store_reshared_received_pubshare
7.21 Missing update of total nodes in add_node function
7.22 Multiple overflows in polynomial operations
7.23 Invalid threshold calculation in calculate_threshold function
7.24 Function naming and state update issue in check_election_status
7.25 Missing degree constraints in polynomial creation function
7.26 Insecure fallback to local random number generation
7.27 Use of non-cryptographically secure random number generators in dkg nodes