Smart Contract Assessment - Matter Labs (ZKSync)

Prepared by:

HALBORN

Last Updated 10/20/2025

Date of Engagement: January 9th, 2023 - March 8th, 2023

Summary

100% of all REPORTED Findings have been addressed

All findings

Critical

High

Medium

Low

Informational

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

8.1 Circuit not properly working when using shard id > 0
8.2 Head state not enforced to be zero
8.3 Unused circuit functionality
8.4 Queue not enforced to be empty right after popping all elements
8.5 Unneeded initialization of uint256 variables

9. Automated Testing

1. INTRODUCTION

MatterLabs zkSync Era is a Layer 2 blockchain protocol that eliminates Ethereum’s inherent congestion with zero knowledge proofs. Matter Labs' creation is on a mission to accelerate the mass adoption of crypto for personal sovereignty. It is designed to unlock the full potential of trustless blockchain technology while scaling the core values of Ethereum.

MatterLabs engaged Halborn to conduct a security audit on their zero knowledge circuits and the verifier, beginning on 2023-01-09 and ending on 2023-03-08. The security assessment was scoped to the circuits provided to the Halborn team.

2. AUDIT SUMMARY

The team at Halborn was provided two months for the engagement and assigned a full-time security engineer to audit the security of the zero knowledge circuits and the verifier. The security engineer is a blockchain, smart-contract and ZK security expert with advanced penetration testing, smart-contract hacking, and deep knowledge of multiple blockchain protocols.

The purpose of this audit to achieve the following:

Ensure that the circuits operate as intended.
Identify potential security issues within the circuits.
Ensure that the verifier operate as intended.
Identify potential security issues within the verifier contracts.

In summary, Halborn identified some security risks that were mostly addressed by the MatterLabs team.

3. TEST APPROACH & METHODOLOGY

Halborn performed a combination of manual and automated security testing to balance efficiency, timeliness, practicality, and accuracy in regard to the scope of this audit. While manual testing is recommended to uncover flaws in logic, process, and implementation; automated testing techniques help enhance coverage of the bridge code 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 audit:

Research into architecture and purpose.
Smart contract manual code review and walkthrough.
Circuit manual code review and walkthrough.
Graphing out functionality and circuit logic/connectivity/functions. (cargo-deps)
Manual code review of common Rust security vulnerabilities.
Manual code review of specific zero knowledge security vulnerabilities.
Scanning of circuits files for unsafe Rust code usage. (cargo-geiger)
Static Analysis of security for scoped circuits, and imported functions. (cargo-audit)

4. SCOPE

1. IN-SCOPE:

The security assessment was scoped to the following zero knowledge circuits:

/src/vm/*
/src/glue/sort_decommitments_requests/*
/src/glue/code_unpacker_sha256/*
/src/glue/demux_log_queue/*
/src/precompiles/keccak256.rs
/src/precompiles/sha256.rs
/src/glue/ecrecover_circuit/*
/src/glue/ram_permutation/*
/src/glue/storage_validity_by_grand_product/*
/src/glue/storage_application/*
/src/glue/pub_data_hasher/*
/src/glue/log_sorter/*
/src/glue/merkleize_l1_messages/*
/src/scheduler/*
/src/circuit_structures/*
/src/data_structures/*
/src/inputs/*
/src/recursion/*
/src/traits/*
/src/secp256k1/*
/src/utils.rs

Commit ID : 014e674916058e31725d6e92439fa5ff14e6677e

And the verifier:

/zksync/Verifier.sol
/zksync/Plonk4VerifierWithAccessToDNext.sol
/zksync/libraries/PairingsBn254.sol
/zksync/libraries/TranscriptLib.sol

Commit ID : fc7e86a3df404acb88d86502c944c0630a7ed288

2. REMEDIATION PR/COMMITS:

Fix Commit ID (HAL-01) : 5109e0768c7de799f87ec67bf40b6a544cca4e4e
Fix Commit ID (HAL-02) : b0a79356613655bddccaab3b89dbf1142b5483fb
Fix Commit ID (HAL-03): 06c2e76546369fb112d8ac14fb5388154857435b

5. 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.

5.1 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:

$E = \prod m_e$

5.2 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:

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

5.3 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

6. SCOPE

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

7. Assessment Summary & Findings Overview

Critical

High

Medium

Low

Informational

Security analysis	Risk level	Remediation Date
CIRCUIT NOT PROPERLY WORKING WHEN USING SHARD ID > 0	Critical	Solved - 04/03/2023
HEAD STATE NOT ENFORCED TO BE ZERO	Low	Solved - 04/03/2023
UNUSED CIRCUIT FUNCTIONALITY	Informational	Solved - 04/03/2023
QUEUE NOT ENFORCED TO BE EMPTY RIGHT AFTER POPPING ALL ELEMENTS	Informational	Acknowledged - 04/03/2023
UNNEEDED INITIALIZATION OF UINT256 VARIABLES	Informational	Acknowledged - 04/03/2023

Recommendation

9. 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. Audit summary
3. Test approach & methodology
4. Scope
5. Risk methodology
6. Scope
7. Assessment summary & findings overview
8. Findings & Tech Details

8.1 Circuit not properly working when using shard id > 0
8.2 Head state not enforced to be zero
8.3 Unused circuit functionality
8.4 Queue not enforced to be empty right after popping all elements
8.5 Unneeded initialization of uint256 variables