Decentralized lending platform Compound continues to be affected by a code bug inside a recent governance proposal to update its cost feeds.
The code error has “temporarily frozen” the Compound Ether (cETH) market, causing cETH transactions to revert, but Compound Labs mentioned that regardless of the front finish no longer working, “funds aren’t immediately in danger.”
Compound Labs announced on Wednesday that the code bug originated from Proposal 117: Compound Oracle Upgrade v3, that was implemented a few hrs ago to update the oracle contracts around the Compound protocol to a different version that utilizes Uniswap V3 rather of V2 for cost feeds.
An hour or so ago, Proposal 117 was performed, which updated the cost feed that Compound v2 uses.
This cost feed, while audited by three auditors, contained a mistake that’s causing transactions for ETH suppliers and borrowers to revert.https://t.co/a2DFk7h0ET
— Compound Labs (@compoundfinance) August 30, 2022
As a result of the cETH market temporarily freezing, Compound Labs stated it aimed to revert towards the previous cost feed via Proposal 119: Oracle Update. The brand new proposal was produced under 1 hour after Proposal 117 have been performed, however, it now needs to undergo a seven-day governance process before you take effect.
According for an update from security solutions architect Michael Lewellen of OpenZeppelin, the code bug originated from the “getUnderlyingPrice” function, which didn’t update the cost of cETH tokens, which may return empty bytes and make the call to become reverted.
Browse the following publish for information on a substance incident we’re trying to persistence for the cETH market. A fix has already been going ahead with no money is in danger at the moment. All of those other cToken markets on Compound V2 and every one of V3 remain functional.https://t.co/CiSE3a99Wa
— OpenZeppelin (@OpenZeppelin) August 30, 2022
Lewellen also reaffirmed that no money is in danger:
“The primary issue at this time is really a temporary denial and services information for that cETH market which is resolved through the new governance proposal. No money is in danger at the moment. All of those other cToken markets on Compound V2 and every one of V3 remain functional.”
However, Lewellen added that “any users that deposited ETH and acquired cETH for opening borrow positions should be aware they could easily get instantly liquidated whenever the fix proposal executes if with that time the cost of ETH has dropped considerably.”
But, the Chief executive officer of Compound Labs, Robert Leshner, also added that users can continue to pay back any debt and add collateral to prevent liquidation.
Related: Exactly what is a smart contract security audit? A beginner’s guide
Compound Labs noted the code bug came regardless of the oracle contract being audited from three separate smart contract auditing companies, with OpenZeppelin and ChainSecurity one of the recent firms to possess audited Compound’s smart contracts.
Proposal 117 itself didn’t seem like questionable one, with all of 696,665 votes from 245 different wallet addresses in support of the cost feed upgrade. Crypto investment firm Polychain Capital cast probably the most votes (306,146) in support of the proposal.
Based on DefiLlama, Compound may be the third largest decentralized lending platform, having a $2.67 billion total value locked (TVL). This news hasn’t affected Compound (COMP) to date, that is sitting at $48.27 during the time of writing.
