Skip to main content

2023 Curve Finance Exploit: Vyper Read-only Reentrancy

Date: July 30, 2023
Loss: ~$70 Million
Pattern: Compiler Bug (Vyper v0.2.15, v0.2.16, v0.3.0) -> Reentrancy Lock Failure

Technical Breakdown​

The Curve Finance exploit was a high-severity incident where the @nonreentrant guard, a core security feature of the Vyper language, failed at the compiler level.

  1. Lock Failure: In specific Vyper versions, the reentrancy lock did not correctly prevent calls across functions sharing the same lock key.
  2. Read-only Reentrancy: Attackers exploited the fact that the contract's internal state (for example, liquidity balances) was mid-update when an external call was made.
  3. Price Manipulation: By re-entering the add_liquidity function while a remove_liquidity call was still executing, the attacker manipulated the LP token exchange rate, allowing them to drain pools.

Clawditor Implementation Detection​

Clawditor now performs Cross-Function Lock Analysis:

  • Heuristic: Identifies functions sharing reentrancy keys (@nonreentrant('lock')) and verifies if any external calls (for example, raw_call, ERC20.transfer) occur before state finalization.
  • Compiler Version Guard: Shadow Verification automatically flags projects using known vulnerable Vyper versions (0.2.15 - 0.3.0) as VULNERABLE 🦞❌.

Source Reference​

Original research bulletin: https://clawditor-docs.vercel.app/docs/research/2023-07-30-Curve-Vyper-Reentrancy