Stratium HYPE Staking Vault Audit | HorizonX

Summary

100% of all REPORTED Findings have been addressed

About this report

Assessment Type

Assurance Assessment

Date of Engagement

December 8th, 2025 - December 24th, 2025

Source Code

stratium-hyperliquid-vault

stratium-hyperliquid-vault-main (2).zip

Assessed Commit ID

7b1ebd7

Severity Breakdown

0Risk Accepted
1Acknowledged
11Solved
12All Findings

Critical0
High0
Medium3
- 3Solved
Low2
- 2Solved
Informational7
- 6Solved
- 1Ack.

Introduction#

HorizonX engaged Halborn to conduct a security assessment on their smart contracts beginning on December 8th, 2025 and ending on December 24th, 2025. The security assessment was scoped to the smart contracts provided in the strong-smart-contracts-internal Github repository, provided to the Halborn team. Commit hash and further details can be found in the Scope section of this report.

The Stratium Hyperliquid Vault is a liquid staking protocol where users deposit HYPE tokens to receive srHYPE, the vault delegates to validators via HyperCore precompiles, manages withdrawal queues with unbonding periods, and distributes collateral rewards.

Following the completion of the initial audit, two additional issues were identified during a re-scan of commit 4870a97 and subsequently remediated in commit 1604c64:

Accounting drift in totalUnstakingForWithdrawals during slashing events - The applySlash() function failed to update the totalUnstakingForWithdrawals tracking variable when reducing withdrawal amounts, causing incorrect liquidity calculations.
Batch processor DoS via non-existent HyperCore account - The processWithdrawalQueue() function would revert when encountering users without HyperCore accounts, permanently blocking the batch withdrawal processor.

Both issues have been successfully resolved in the remediation commit with appropriate accounting updates and graceful error handling.

Assessment Summary#

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 possess 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 issues within the Stratium protocol smart contracts.
Ensure that smart contract of Stratium protocol functions operate as intended.

In summary, Halborn identified several areas for improvement to reduce the likelihood and impact of security risks, which were successfully addressed by the HorizonX team. The main recommendations were:

Decouple reward balance snapshotting from reward distribution by fixing eligible balances in a prior block, thereby preventing same-block manipulation.
Extend the slashing mechanism to support multiple events by allowing repeated slashing with appropriate safeguards and event logging.
Add a pre-transfer balance check to ensure the Core spot balance for the specified collateral is sufficient to cover the reward amount, reverting otherwise.
Include logic to refresh Core balances from L1Read before processing withdrawals.

Test approach and methodology#

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 Stratium protocol.
Manual code review and walkthrough of the Stratium 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 contracts and imported functions (Slither).
Local deployment and testing with Foundry

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:stratium-hyperliquid-vault

(b) Assessed Commit ID:7b1ebd79a3aedb23d88a6a05a9a358dab9541fd7

7 files

library

4 files

CoreWriterLibrary.sol

solidity

DecimalConverter.sol

solidity

L1Read.sol

solidity

StructuredLinkedList.sol

solidity

RewardDistributor.sol

solidity

srHYPE.sol

solidity

StakingVault.sol

solidity

Out-of-Scope:Third-party dependencies and economic attacks.

(a) Submitted File: stratium-hyperliquid-vault-main (2).zip

(b) Items in scope:

8 files

stratium-hyperliquid-vault-main / src

8 files

library

4 files

CoreWriterLibrary.sol

solidity

DecimalConverter.sol

solidity

L1Read.sol

solidity

StructuredLinkedList.sol

solidity

RewardDistributor.sol

solidity

RoleRegistry.sol

solidity

srHYPE.sol

solidity

StakingVault.sol

solidity

ddd9c078c46224f64387f2748055e876574d6621 6519e014d479e74d331103686ad98b2c21089533 1604c6458fe92911f69370b6f3b67f655eebb93e 6fdfc3645bafc58b35d0fc412d1f0e6df761bc26 691d9cb5c430efb8a38f56c55e8341259b7a44f3 914cd0870a08609222cc5fb542cd87e4f2f21e12 d0cc5d4a2c83024728482f6e92fa5d9efc1c0fec 51c5f23c2b44c91cce558a7c8ee9b05f4a8e66bf b2d428aa4ffde899ce01c6aee071da5c1a8037e5

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

Assessment Summary & Findings Overview#

#	Title	Severity	Score	Status
HAL-01	Front running reward distribution allows disproportionate reward capture	Medium	5.0	Solved01/05/2026
HAL-02	Single-use slashing flag prevents handling multiple slash events	Medium	5.0	Solved01/05/2026
HAL-03	Accounting drift in totalUnstakingForWithdrawals during slashing events	Medium	5.0	Solved02/08/2026
HAL-04	Missing core balance check before reward transfer	Low	3.8	Solved01/05/2026
HAL-05	Unbounded loop over all historical withdrawal requests during slashing	Low	3.8	Solved01/05/2026
HAL-06	Gas limit denial of service in reward distribution loop	Informational	1.9	Solved01/09/2026
HAL-07	Cancelled withdrawals leave unstaked HYPE idle in core	Informational	1.9	Solved01/09/2026
HAL-08	Lack of slippage protection on deposits	Informational	1.9	Acknowledged01/09/2026
HAL-09	Syncing balances during unbonding can cause claim underflow and denial of service	Informational	1.7	Solved01/09/2026
HAL-10	Lack of two-step ownership transfer	Informational	1.5	Solved01/09/2026
HAL-11	Batch processor denial of service via non-existent HyperCore account	Informational	1.3	Solved02/08/2026
HAL-12	Inconsistent / Floating pragma usage	Informational	1.1	Solved01/09/2026

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.