From 26a0a5e7e8fa81973b18f71ca03fad41832d7ecf Mon Sep 17 00:00:00 2001
From: jayesh yadav <jayeshnyadav497@gmail.com>
Date: Sat, 18 Jul 2026 16:17:47 +0530
Subject: [PATCH] fix(H5): mark wstETH at the Lido exchange rate, not the DEX
 spot

Audit H5: wstethUsdWad marked wstETH at the lower of the exchange rate
and the instantaneous UniV3 slot0 spot. slot0 is flash-loan manipulable
within a block, and because it was the lower-of, an attacker could push
the mark DOWN (front-run settleEpoch, depress the pool, mint extra
shares cheaply, back-run) to skew share pricing.

Fix: mark wstETH purely at stEthPerToken x ETH/USD, the fundamental
redemption value and the standard wstETH-collateral marking
(Aave/Morpho). It is not flash-manipulable, so it cannot skew NAV or
settlement pricing. The pool spot is kept ONLY as a depeg gate on
BUYING more wstETH (wstethBuyAllowed), where a manipulated spot is
fail-safe: it can only block a buy, never inflate value. Regression:
a basis breach keeps the mark at the exchange rate while blocking buys;
an extreme flash-pushed pool spot leaves the mark unchanged. 116 -> 117.
---
 src/OracleHub.sol    | 18 +++++++++---------
 test/OracleHub.t.sol | 25 +++++++++++++++++--------
 2 files changed, 26 insertions(+), 17 deletions(-)

diff --git a/src/OracleHub.sol b/src/OracleHub.sol
index daa63e4..abef960 100644
--- a/src/OracleHub.sol
+++ b/src/OracleHub.sol
@@ -105,16 +105,16 @@ contract OracleHub is IPriceSource, IRateOracle, Ownable {
         return snapshotEthUsdWad; // degraded: last-good so floor defense continues
     }
 
-    /// @notice wstETH marked at the LOWER of exchange-rate and pool-spot
-    ///         valuations whenever they disagree beyond the basis limit.
+    /// @notice wstETH marked at the Lido exchange rate (stEthPerToken x
+    ///         ETH/USD), NOT the DEX spot (audit H5). The exchange rate is the
+    ///         fundamental redemption value and, unlike a UniV3 slot0 read, is
+    ///         not flash-loan manipulable, so it cannot be used to skew share
+    ///         pricing at settlement. This is the standard wstETH-collateral
+    ///         marking (Aave/Morpho). The pool spot is kept only as a depeg
+    ///         gate on BUYING more wstETH (wstethBuyAllowed), where a pushed
+    ///         spot is fail-safe: it can only block a buy, never inflate value.
     function wstethUsdWad() external view returns (uint256) {
-        uint256 eth = ethUsdWad();
-        uint256 rateBased = wsteth.stEthPerToken().mulWad(eth);
-        uint256 poolBased = _poolWethPerWsteth().mulWad(eth);
-        if (_basisBps(rateBased, poolBased) > maxBasisBps) {
-            return FixedPointMathLib.min(rateBased, poolBased);
-        }
-        return rateBased;
+        return wsteth.stEthPerToken().mulWad(ethUsdWad());
     }
 
     function wstethBuyAllowed() external view returns (bool) {
diff --git a/test/OracleHub.t.sol b/test/OracleHub.t.sol
index addf1a3..5cfac58 100644
--- a/test/OracleHub.t.sol
+++ b/test/OracleHub.t.sol
@@ -97,16 +97,25 @@ contract OracleHubTest is Test {
         hub.refresh();
     }
 
-    function test_basisBreach_marksLower_blocksBuys() public {
-        // pool prints wstETH 5% below the exchange rate (depeg scenario)
-        pool.setRatioWad(1.14e18);
-        assertApproxEqRel(hub.wstethUsdWad(), 2280e18, 1e6); // marked at pool (lower)
+    function test_h5_basisBreach_marksAtRate_blocksBuys() public {
+        // H5: the VALUE mark is always the exchange rate, never the pool spot,
+        // so a manipulated/depegged pool cannot skew NAV/share pricing. A basis
+        // breach only flips the buy gate (fail-safe, blocks buying more wstETH).
+        pool.setRatioWad(1.14e18); // pool 5% below the exchange rate (depeg)
+        assertApproxEqRel(hub.wstethUsdWad(), 2400e18, 1e6); // still exchange-rate
+        assertFalse(hub.wstethBuyAllowed()); // but buys are blocked
+
+        pool.setRatioWad(1.32e18); // pool above the exchange rate
+        assertApproxEqRel(hub.wstethUsdWad(), 2400e18, 1e6); // still exchange-rate
         assertFalse(hub.wstethBuyAllowed());
+    }
 
-        // exchange rate lower than pool: still marks the lower one
-        pool.setRatioWad(1.32e18);
-        assertApproxEqRel(hub.wstethUsdWad(), 2400e18, 1e6); // rate-based is lower
-        assertFalse(hub.wstethBuyAllowed());
+    function test_h5_poolPushDownCannotLowerTheMark() public {
+        // the attack: push the pool spot far down to depress the wstETH mark
+        // and mint extra shares cheaply. Under the fix the mark does not move.
+        uint256 markBefore = hub.wstethUsdWad();
+        pool.setRatioWad(0.5e18); // extreme flash-manipulated spot
+        assertEq(hub.wstethUsdWad(), markBefore); // unaffected
     }
 
     function test_smallBasis_usesExchangeRate() public {