Vault Contracts v2 - Rho Labs

Prepared by:

HALBORN

Last Updated 08/13/2025

Date of Engagement: July 15th, 2025 - July 29th, 2025

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 Incorrect address used during sub vaults asset calculation
7.2 Share inflation attack possible in allocatorvault with zero decimals offset
7.3 Potential value mismatch when adding erc20 and native token deposits
7.4 Zero address and zero id insertion possible in iterableidaddressset
7.5 Decimals mismatch between parent and subvaults could break accounting
7.6 Insufficient input validation
7.7 Inconsistent role id derivation reduces maintainability
7.8 Unvalidated offset parameter in role address query
7.9 Duplicated logic between previewdeposit and _previewdeposit can lead to inconsistencies
7.10 Commented functionality
7.11 Inconsistent use of uint alias instead of uint256
7.12 Floating pragma
7.13 Suboptimal modifier ordering
7.14 Unused functionality
7.15 Use of revert strings instead of custom errors
7.16 Unnecessary casting between uint and int increases code complexity and risk of subtle bugs
7.17 Missing event
7.18 Unused components

8. Automated Testing

1. Introduction

Rho Labs engaged Halborn to perform a security assessment of their smart contracts from July 15th, 2025, to July 28th, 2025. 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 Rho Labs codebase in scope consists of a smart contract system for asset management, featuring ERC4626-compliant vaults, allocator and off-chain strategy vaults, a secure router for user and vault interactions, and robust access control. The system supports oracle-driven NAV reporting, and protocol-level controls for asset flows and permissions.

2. Assessment Summary

Halborn was allocated 10 days for this engagement and assigned 1 full-time security engineer to conduct a comprehensive review of the smart contracts within scope. The engineer is an expert in blockchain and smart contract security, with advanced skills in penetration testing and smart contract exploitation, as well as extensive knowledge of multiple blockchain protocols.

The objectives of this assessment were 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 potential risks, which were mostly addressed by the Rho Labs team. The primary recommendations were:

Replace vault.maxWithdraw(vaultAddress, vaultAddress, packages) with vault.maxWithdraw(address(this), address(this), packages) in _calcTotalSubVaultsAssets to ensure the calculation reflects the parent vault’s actual claim on the subVault’s assets.
Fund the vault with a meaningful initial deposit immediately after deployment and before allowing public deposits, ensuring a fair initial share/asset ratio.
Enforce at vault or ERC20Storage initialization that any asset marked as a wrapped native token has the same number of decimals as the native token for the deployment chain.

3. Test Approach and Methodology

Halborn conducted a combination of manual code review and automated security testing to balance efficiency, timeliness, practicality, and accuracy within the scope of this assessment. While manual testing is crucial for identifying flaws in logic, processes, and implementation, automated testing enhances coverage of smart contracts and quickly detects deviations from established security best practices.

The following phases and associated tools were employed throughout the term of the assessment:

Research into the platform's architecture, purpose and use.
Manual code review and walkthrough of smart contracts to identify any logical issues.
Comprehensive assessment of the safety and usage of critical Solidity variables and functions within scope that could lead to arithmetic-related vulnerabilities.
Local testing using custom scripts (Foundry).
Fork testing against main networks (Foundry).
Static security analysis of scoped contracts, and imported functions (Slither).

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: vault-contracts-v2

(b) Assessed Commit ID: 25d8204

contracts/access-control/AccessControlManager.sol
contracts/access-control/IAccessControlManager.sol
contracts/access-control/IAccessControlManagerErrors.sol
contracts/access-control/Roles.sol
contracts/configuration/Configurator.sol
contracts/configuration/ContractProvider.sol
contracts/configuration/IConfigurator.sol
contracts/configuration/IContractProvider.sol
contracts/configuration/IContractProviderErrors.sol
contracts/external/OracleDomain.sol
contracts/libraries/ContractIds.sol
contracts/libraries/IIterableIdAddressSetErrors.sol
contracts/libraries/IterableIdAddressSet.sol
contracts/libraries/WithdrawalRequestsQueue.sol
contracts/libraries/WithdrawalRequestsQueueErrors.sol
contracts/router/libraries/RouterLogic.sol
contracts/router/IRouter.sol
contracts/router/IRouterErrors.sol
contracts/router/Router.sol
contracts/utils/AddressValidator.sol
contracts/utils/IAddressValidatorErrors.sol
contracts/utils/IInterfaceValidationErrors.sol
contracts/utils/IPausable.sol
contracts/utils/ITimeProviderErrors.sol
contracts/utils/IWrappedNativeToken.sol
contracts/utils/ReentrancyGuardUpgradeable.sol
contracts/utils/TimeProvider.sol
contracts/vault/base/libraries/VaultBaseLogic.sol
contracts/vault/base/IVaultBase.sol
contracts/vault/base/IVaultBaseErrors.sol
contracts/vault/base/VaultBase.sol
contracts/vault/erc20/libraries/ERC20Logic.sol
contracts/vault/erc20/storage/ERC20Storage.sol
contracts/vault/erc20/storage/IERC20Storage.sol
contracts/vault/erc20/IRhoERC20.sol
contracts/vault/erc20/RhoERC20.sol
contracts/vault/erc4626/libraries/ERC4626Logic.sol
contracts/vault/erc4626/IRhoERC4626.sol
contracts/vault/erc4626/IRhoERC4626Errors.sol
contracts/vault/erc4626/RhoERC4626.sol
contracts/vault/implementations/allocator/AllocatorVault.sol
contracts/vault/implementations/allocator/IAllocatorVault.sol
contracts/vault/implementations/strategies/IOffchainStrategiesVault.sol
contracts/vault/implementations/strategies/IOffchainStrategiesVaultErrors.sol
contracts/vault/implementations/strategies/OffchainStrategiesVault.sol
contracts/vault/storage/IVaultStorage.sol
contracts/vault/storage/IVaultStorageErrors.sol
contracts/vault/storage/Parameters.sol
contracts/vault/storage/VaultStorage.sol

contracts/access-control/AccessControlManager.sol
contracts/access-control/IAccessControlManager.sol
contracts/access-control/IAccessControlManagerErrors.sol

↓ Expand ↓

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

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
Incorrect address used during sub vaults asset calculation	High	Solved - 07/29/2025
Share inflation attack possible in AllocatorVault with zero decimals offset	Medium	Risk Accepted - 08/07/2025
Potential value mismatch when adding ERC20 and native token deposits	Low	Solved - 07/29/2025
Zero address and zero ID insertion possible in IterableIdAddressSet	Low	Solved - 07/29/2025
Decimals mismatch between parent and subVaults could break accounting	Low	Solved - 08/06/2025
Insufficient input validation	Informational	Acknowledged - 07/30/2025
Inconsistent role ID derivation reduces maintainability	Informational	Solved - 07/29/2025
Unvalidated offset parameter in role address query	Informational	Solved - 07/29/2025
Duplicated logic between previewDeposit and _previewDeposit can lead to inconsistencies	Informational	Solved - 08/06/2025
Commented functionality	Informational	Solved - 07/29/2025
Inconsistent use of uint alias instead of uint256	Informational	Solved - 07/29/2025
Floating pragma	Informational	Solved - 07/29/2025
Suboptimal modifier ordering	Informational	Solved - 07/29/2025
Unused functionality	Informational	Solved - 08/05/2025
Use of revert strings instead of custom errors	Informational	Solved - 08/05/2025
Unnecessary casting between uint and int increases code complexity and risk of subtle bugs	Informational	Solved - 08/05/2025
Missing event	Informational	Solved - 08/05/2025
Unused components	Informational	Solved - 08/05/2025

7. Findings & Tech Details

7.1 Incorrect address used during sub vaults asset calculation

High

Description

Proof of Concept

BVSS

AO:A/AC:L/AX:L/R:N/S:U/C:N/A:N/I:L/D:H/Y:N (8.1)

Recommendation

Remediation Comment

Remediation Hash

https://github.com/RhoLabs/vault-contracts-v2/commit/4d9b733e2bc8522a968441596635f04582bae3e6

7.2 Share inflation attack possible in AllocatorVault with zero decimals offset

Medium

Description

Proof of Concept

BVSS

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

Remediation Hash

https://github.com/RhoLabs/vault-contracts-v2/commit/456581ae14bc3c6ed225a3a63280761540555d0a

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 Incorrect address used during sub vaults asset calculation
7.2 Share inflation attack possible in allocatorvault with zero decimals offset
7.3 Potential value mismatch when adding erc20 and native token deposits
7.4 Zero address and zero id insertion possible in iterableidaddressset
7.5 Decimals mismatch between parent and subvaults could break accounting
7.6 Insufficient input validation
7.7 Inconsistent role id derivation reduces maintainability
7.8 Unvalidated offset parameter in role address query
7.9 Duplicated logic between previewdeposit and _previewdeposit can lead to inconsistencies
7.10 Commented functionality
7.11 Inconsistent use of uint alias instead of uint256
7.12 Floating pragma
7.13 Suboptimal modifier ordering
7.14 Unused functionality
7.15 Use of revert strings instead of custom errors
7.16 Unnecessary casting between uint and int increases code complexity and risk of subtle bugs
7.17 Missing event
7.18 Unused components