Mix use to two accounting systems
Days in Operation:
100 pts each
ElasticSwap is an all new AMM focused on elastic supply tokens. The project was exploited for approx. 523 ETH.
Flash loans was utilized to manipulate price and the root cause is due to the mix/misuse of two accounting systems. For addLiquidity, it uses the internal accounting system, e.g., uses a constant K value algorithm; while for removeLiquidity, it calculates the tokens to return with the token-balance-based accounting system and reduces the internal accounting reserves.
The attacker first adds liquidity and transfers a certain amount of $USDC.e into the TIC-USDC pool, at which point the amount of USDC.e to be transferred to the attacker is multiplied by the number of LP tokens, then the attacker removes liquidity to make a profit.
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