The smart contract audit flow is fairly standard among audit providers. Each auditor's approach is slightly different, but the typical process is as follows.
1. Determine audit scope. The specifications of smart contracts and projects are defined by the project (its intended purpose) and the overall structure. The spec helps the audit team understand the goals of the project when writing and using the code.
2. We will provide an initial quote for the amount of work required.
3. Run the test. The specifics will vary depending on the audit team, analytical tools and methodologies. Both manual and automated testing are typically performed.
4. Produce a first draft of the report if errors are found and provide it to the project team for feedback and follow-up corrections.
5. Consider the team's response to the findings and issue a final report.
Smart Contract Audit Method
Gas Efficiency
Smart contract audits are not just focused on blockchain security. We also look at efficiency and optimization. Some contracts have a complex series of transactions to perform their intended function. Gas fees on networks like Ethereum are relatively expensive, so efficient contracts can significantly reduce transaction costs.
Optimizing its performance is also a showcase for developers. Inefficient steps increase the number of possible sources of failure and should be avoided. If the gas price is high, the smart contract may fail to run, and if the gas price limit is low, it is even more likely to fail.
Contract Vulnerability
Most of an audit's job is to check contracts for security vulnerabilities. While some issues are more visible, many exploits involve sophisticated techniques and strategies to drain funds. For example, weak smart contracts can be used to manipulate the market and launch flash loan attacks. To uncover these issues, auditors initiate a process of break testing, simulating malicious attacks on smart contracts. Common vulnerabilities include:
1. Reentrancy Problem: A smart contract calls another external contract before executing any code. An external contract can recursively call the original smart contract and interact with it in ways it would otherwise not be able to, even though the original contract's balance has not yet been updated.
2. Integer Overflow and Underflow: Occurs when a smart contract performs arithmetic operations that exceed the storage capacity of the output (usually 18 decimal places). Therefore, incorrect quantities may be calculated.
3. Front-running Opportunities: Poorly structured code can expose market buy and sell harbingers. As a result, others can use that information and trade for their own benefit.
Platform Security Flaws
Most audits involve looking at the network that hosts the contract, or even the APIs used to interact with the DApp. The project is vulnerable to DDoS attacks, which can compromise the website UI. In other words, users are actually connecting their wallets to malicious blockchain applications.
What is an Audit Report?
An audit report is provided at the end of the audit process. To ensure transparency, projects are expected to share their results with the community. Most reports categorize problems by severity, such as critical, major, or minor. The report also documents the status of the issues, as the project is given time to resolve before the final report is published.
A standard report includes recommendations, redundant code examples, and a full breakdown of coding errors, along with an executive summary. Projects are given time to act on the results of the report before the final version is published.
