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FLO-25: Dex Price Susceptible to Sandwich Attacks in Liquidation #234
Description
Severity: Low
Files Affected
cadence/contracts/FlowALPv1.cdc
Description
In the manualLiquidation() function, the DEX quote is fetched and compared in the same transaction. A sandwich attack can be executed where:
- Front-run: Manipulate DEX pool to worsen its price.
- Liquidation executes: DEX quote is artificially bad, so the liquidator's offer appears "better than DEX".
- Back-run: Reverse manipulation for profit.
Recommendation
Use TWAP instead of spot quote, or use oracle price as the primary benchmark.
Parent Issue: #209
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holyfuchs commentedon Mar 13, 2026
The oracle we are adding ensures the spread between sources (including the DEX) isn't too high; otherwise, it won't return a price. It also ensures short-term volatility isn't too high.
Additionally, there is another assert in the function:
FlowALP/cadence/contracts/FlowALPv0.cdc
Lines 597 to 599 in 802c194
A small sandwich attack is always possible. I don't think we should make any changes.