From 322ec2f15f633003c05ce0fe947cd2116de2575b Mon Sep 17 00:00:00 2001
From: Nicholas Addison <nick@addisonbrown.com.au>
Date: Wed, 9 Oct 2024 15:43:46 +1100
Subject: [PATCH] Safety check in setCrossPrice so no stETH in ARM when cross
 price reduced

---
 src/contracts/AbstractARM.sol                 | 18 ++++++++----
 .../LidoFixedPriceMultiLpARM/Setters.t.sol    | 29 ++++++++++++++++---
 2 files changed, 38 insertions(+), 9 deletions(-)

diff --git a/src/contracts/AbstractARM.sol b/src/contracts/AbstractARM.sol
index b4db783..90987d4 100644
--- a/src/contracts/AbstractARM.sol
+++ b/src/contracts/AbstractARM.sol
@@ -391,13 +391,21 @@ abstract contract AbstractARM is OwnableOperable, ERC20Upgradeable {
         emit TraderateChanged(_baseToTokenRate, _tokenToBaseRate);
     }
 
-    function setCrossPrice(uint256 _crossPrice) external onlyOwner {
-        require(_crossPrice >= PRICE_SCALE - MAX_PRICE_DEVIATION, "ARM: cross price too low");
-        require(_crossPrice <= PRICE_SCALE, "ARM: cross price too high");
+    function setCrossPrice(uint256 newCrossPrice) external onlyOwner {
+        require(newCrossPrice >= PRICE_SCALE - MAX_PRICE_DEVIATION, "ARM: cross price too low");
+        require(newCrossPrice <= PRICE_SCALE, "ARM: cross price too high");
+
+        // If the new cross price is lower than the current cross price
+        if (newCrossPrice < crossPrice) {
+            // The base asset, eg stETH, is not the liquidity asset, eg WETH
+            address baseAsset = liquidityAsset == address(token0) ? address(token1) : address(token0);
+            // Check there is not a significant amount of base assets in the ARM
+            require(IERC20(baseAsset).balanceOf(address(this)) < MIN_TOTAL_SUPPLY, "ARM: too many base assets");
+        }
 
-        crossPrice = _crossPrice;
+        crossPrice = newCrossPrice;
 
-        emit CrossPriceUpdated(_crossPrice);
+        emit CrossPriceUpdated(newCrossPrice);
     }
 
     ////////////////////////////////////////////////////
diff --git a/test/fork/LidoFixedPriceMultiLpARM/Setters.t.sol b/test/fork/LidoFixedPriceMultiLpARM/Setters.t.sol
index af68ae0..55e3456 100644
--- a/test/fork/LidoFixedPriceMultiLpARM/Setters.t.sol
+++ b/test/fork/LidoFixedPriceMultiLpARM/Setters.t.sol
@@ -89,7 +89,7 @@ contract Fork_Concrete_lidoARM_Setters_Test_ is Fork_Shared_Test_ {
     //////////////////////////////////////////////////////
     /// --- Set Prices - REVERTING TESTS
     //////////////////////////////////////////////////////
-    function test_RevertWhen_SetPrices_Because_PriceCross() public {
+    function test_RevertWhen_SetPrices_Because_PriceCross() public asLidoARMOwner {
         vm.expectRevert("ARM: Price cross");
         lidoARM.setPrices(90 * 1e33, 89 * 1e33);
 
@@ -160,7 +160,7 @@ contract Fork_Concrete_lidoARM_Setters_Test_ is Fork_Shared_Test_ {
     }
 
     //////////////////////////////////////////////////////
-    /// --- Set Prices - REVERTING TESTS
+    /// --- Set Cross Price - REVERTING TESTS
     //////////////////////////////////////////////////////
     function test_RevertWhen_SetCrossPrice_Because_NotOwner() public asRandomAddress {
         vm.expectRevert("ARM: Only owner can call this function.");
@@ -182,11 +182,20 @@ contract Fork_Concrete_lidoARM_Setters_Test_ is Fork_Shared_Test_ {
         lidoARM.setCrossPrice(1.0001e36);
     }
 
+    function test_RevertWhen_SetCrossPrice_With_stETH_Because_PriceDrop() public {
+        deal(address(steth), address(lidoARM), MIN_TOTAL_SUPPLY + 1);
+
+        vm.expectRevert("ARM: too many base assets");
+        lidoARM.setCrossPrice(0.9998e36);
+    }
+
     //////////////////////////////////////////////////////
-    /// --- Set Prices - PASSING TESTS
+    /// --- Set Cross Price - PASSING TESTS
     //////////////////////////////////////////////////////
 
-    function test_SetCrossPrice_Owner() public {
+    function test_SetCrossPrice_No_StETH_Owner() public {
+        deal(address(steth), address(lidoARM), MIN_TOTAL_SUPPLY - 1);
+
         // at 1.0
         vm.expectEmit({emitter: address(lidoARM)});
         emit AbstractARM.CrossPriceUpdated(1e36);
@@ -198,6 +207,18 @@ contract Fork_Concrete_lidoARM_Setters_Test_ is Fork_Shared_Test_ {
         lidoARM.setCrossPrice(0.9998e36);
     }
 
+    function test_SetCrossPrice_With_StETH_PriceUp_Owner() public {
+        // 2 basis points lower than 1.0
+        lidoARM.setCrossPrice(0.9998e36);
+
+        deal(address(steth), address(lidoARM), MIN_TOTAL_SUPPLY + 1);
+
+        // 4 basis points lower than 1.0
+        // vm.expectEmit({emitter: address(lidoARM)});
+        // emit AbstractARM.CrossPriceUpdated(0.9996e36);
+        lidoARM.setCrossPrice(0.9999e36);
+    }
+
     //////////////////////////////////////////////////////
     /// --- OWNABLE - REVERTING TESTS
     //////////////////////////////////////////////////////