CVE intelligence and bounded remediation

CVE-2023-42449 — Hydra is the two-layer scalability solution for Cardano

Hydra is the two-layer scalability solution for Cardano. Prior to version 0.13.0, it is possible for a malicious head initializer to extract one or more PTs for the head they are initializing due to incorrect data validation logic in the head token minting policy which then results in an flawed check for burning the head ST in the `initial` validator. This is possible because it is not checked in `HeadTokens.hs` that the datums of the outputs at the `initial` validator are equal to the real head ID, and it is also not checked in the `off-chain code`. During the `Initial` state of the protocol, if the malicious initializer removes a PT from the Hydra scripts it becomes impossible for any other participant to reclaim any funds they have attempted to commit into the head, as to do so the Abort transaction must burn all the PTs for the head, but they cannot burn the PT which the attacker controls and so cannot satisfy this requirement. That means the initializer can lock the other participants committed funds forever or until they choose to return the PT (ransom). The malicious initializer can also use the PT to spoof that they have committed a particular TxO when progressing the head…

Severity

High

CVSS

8.1 (3.1)

Published

2023-10-04

CISA KEV

Not currently listed

Ecosystem

software/application

Weaknesses

CWE-20