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Analysis Reports
Nomad Bridge Exploit Incident Analysis
8/1/2022
Nomad Bridge Exploit Incident Analysis

TL;DR

On Aug 1st, 2022 the Nomad bridge experienced an exploit causing a loss of around $190M worth of assets. The vulnerability was in the initialization process where the “committedRoot” is set as ZERO. Therefore, the attackers were able to bypass the message verification process and drain the tokens from the bridge contract.

Summary

Nomad Bridge, a cross-chain bridge between Ethereum, Moonbeam, Avalanche, Evmos and Milkomeda was exploited for ~$190M. The exploit occured when a routine upgrade allowed verification messages to be bypassed on Nomad. Attackers abused this to copy/paste transactions and were able to drain the bridge of nearly all funds before it could be stopped.

Protocol Details: Nomad Bridge is a protocol allowing users to move digital assets between different blockchains. Asset issuers can deploy tokens across chains. Developers can build native cross-chain applications (xApps) with Nomad. The goal of Nomad is to provide the connective tissue to enable users and developers to interact securely. Nomad is a token bridge that allows transfers of tokens between Avalanche (AVAX), Ethereum (ETH), Evmos (EVMOS), Milkomeda C1, and Moonbeam (GLMR).

The Nomad token bridge appears to have experienced a security exploit that has allowed hackers to systematically drain the bridge’s funds over a long series of transactions.The vulnerability was in the initialization process where the “committedRoot” is set as ZERO. Therefore, the attacker was able to bypass the message verification process and drain the tokens from the bridge contract. Due to this flawed upgrade, users could exploit bridge funds by copying the original hacker's transaction calldata and replacing the original address with a personal one. The transaction then processed and successfully removed funds from the bridge. At this time, ~$190M has been exploited. In four hours, other hackers, bots, and community members replicated the initial attack, draining it in a frenzied mob attack in what twitter user @0xfoobar called, “...the first decentralized crowd-looting of a 9-figure bridge in history?” Nomad tweeted: “We are aware of the incident involving the Nomad token bridge. We are currently investigating and will provide updates when we have them.”Nomad (⤭⛓🏛) on Twitter

Exploit Transactions

Example attack:

There are multiple attacks txs

Addresses

AddressAmount (USD)Gas Source
0x56d8b47.5M (WETH)Tornado Cash
0xbf29339M (USDC+DAI)Tornado Cash
0xb5c558M(CQT+DAI+USDC+WBTC+FRAX)Tornado Cash
0xc99435.6M(USDC+FRAX+WETH+CQT)Tornado Cash ->0x3ee9f5e0c085775312076Ec82ed6bf4942D8BD7f
0x000003M(WBTC+WETH+USDC+FRAX+DAI+CQT)Tornado Cash ->Creator: 0xE71AcA93C0E0721F8250D2d0e4F883AA1C020361
0x518411.5M(ETH + USDC)https://etherscan.io/accounts/label/opportunistResident Arbitrageur
0xe403c1M(FRAX + USDC)Tornado Cash ->0xe3f40743cc18fd45d475fae149ce3ecc40af68c3

Attack Flow

Take transaction 0xa5fe9 as an example.

  1. The attacker called function.

  2. Inside the process function, acceptableRoot(messages[_messageHash]), is called, which is used to check that the root has been submitted and that the optimistic timeout period has expired. The messages[_messageHash] is 0x000 in this case.

lbD8cmxFFGT0pvVZx OtT5syX-XslRYwwvoEKaP88jJD g14M0YMMBMM96yTxZeXaVzr2DjgBIIa9kcHmi8afWtEtd2w06E8qaf3gxxUJhlftLosp 1mGxOVtXwuowh-GU8eskosasxd c56RoyOCDk (1)

  1. The function acceptableRoot(messages[_messageHash]) returns true, and the message is proved. This is caused by 0x0000 is initialized as true(We believe this is a mistake in the deployment).

I8DPT8rmGZOMT2Jyahv8AXnEawQOyDkMVXHkWc2gAx9IVYZsDwhzUW8d2n3X4EORozRdjnEQvKLS365JjubnUo2U1wA 0N49mIbAz5ipTsyhBzm6t47TN8S0DW np1amLrLL8hGVXpgnshYEHWhKzGII8DPT8rmGZOMT2Jyahv8AXnEawQOyDkMVXHkWc2gAx9IVYZsDwhzUW8d2n3X4EORozRdjnEQvKLS365JjubnUo2U1wA 0N49mIbAz5ipTsyhBzm6t47TN8S0DW np1amLrLL8hGVXpgnshYEHWhKzGI

  1. After the message is proved, the attacker is able to transfer tokens out of the bridge.

Vulnerability

Initialization stage

The Replica contract was mistakenly initialized in the transaction 0x53fd9, in which the “committedRoot” is initialized as ZERO.

Attack Stage

Therefore, the attacker can directly call the “process(byte memory _message)” function with an arbitrary “_message” to bypass the verification.

Contract address: 0x88a69

The function process ensures the message hash is proven by checking . CAhN2ccyazdxCQJjV cfVnrv 2RFHvVMubeoHgF-ID9uLuLBFfN5dto71lqPqcO imQx6avOwc-9dTjp687B1lcZwxHL3RC5Gm3DeGU94srGuSKrVWl1kVTDzzSTwzlz5BIFczWjCeWNIis5JcVrwpY

The function will check the root if it’s proven, processed or confirmed.

UpWX-n73x14aC3pDogK9ax5pfy7wVfyuDdeXYjrpABfFsjPVVdXsPsTczvwzUIuWkZrHH-arUB0XRowSwVlMJUZahZX6wUaHVDX-A Q Yge iAEoOkbV0UhobgEQyr 7FeP9JhKS8q3wBPd2sRWAQoA

While in the initialization transaction 0x53fd9, the owner sends 0 and the of 0 will be set as 1.

ut8Kvcrq8rjlGPchC9q6xufziuWPdYusJoTsL7Z4FX28OuRE8z3UNyfDFSWGJyxBF7-8UobqFOe2S8QEgLLZl-HJvmr07LPyfbNoBiJJb9xyPFZ7v HAPO63OqCT6cAGvZp1WzHZsiBGUP4vUQZS- o

2N2QzHs4omRFW4PeEvisfN- vN8 xFDLLYD3LsMNg2Np-9PU1-6CBrzrvrJIxaHFQpeZGdaM53Onh61ohoNTE7G1ufmGA-O1M-MECFholbTE2otaYD0PUd8nT38klazseZ2A FrPxiIAv5agnKRiFhg

Thus, zero is considered as an and can be checked in 0xb9233.

Based on the implementation of function , the root of an unproven message is also zero and zero as a valid confirmed root can bypass the check. The attacker just needs to call send the transaction to the bridge and get the money.

iWRWPVp6-VhI234yWNWykQ54gqLdmfZHLYpfPBVTxC6mefVjpiaVlKmcQR7b9iGIZEj8Yvy3KMC9Gv1hCLulWthfC8wMg1UjeVy85yPVuf5ZDE0dAjq6Mfih2dgMoxI W9IkLGTLAyB2kGu0l5zvctY 5b2GLTo-DJAdHgKKj5NjCvCeDJ32jHij0xTLOONPMuoTdcmX-yvh7iCXAFd-QIv i0b4FNwsFs7u-x83qfmU8gIlfJrjRkCo23TGPcvx1NjLWbjqyNhPdvu9EvjGRozhfAwM rxX9bTBk TYOIHy7RQ

Profit and Assets Tracing

About 190M worth of tokens are drained from the bridge.

DefiLlama ← Current valuation of bridge and charts to the in and outflows. LtbB5J2ILex3joLZj-OvHWm8O7zbYhv3A4twzeRVNfpUiVCB8RncMnov43MSUKV7qmuBbUL5wpYNMMnui5gclSywTL-wwxA9ulnTlICwG yF5 XMfWrdDJhsS95FNJG2zVISFrRYIbM0dsD0qbmYrsY (1)

Token TypeAmount(USD)
USDC87.42M
WETH37.98M
WBTC23.9M
CQT14.2
USDT8.6M
FRAX7.11M
DAI4.48M
IAG4.1M

Can the issue be found during the audit?

This type of issue would be difficult to discover under conventional auditing practices that assume all deployment configurations are correct, because this particular bug was introduced by mistakes in the deployment parameters. However, a broader auditing process and full-scope penetration test that includes validating deployment processes would potentially capture this bug. In addition, CertiK offers added service for the post deployment stage - Contract Verification which with in-depth analysis of smart contract analysis and post deployment contract verification. For more information, please contact bd@certik.com.

Appendix

Major Assets taken:

For full details on wallet addresses and amounts related to them, please contact CertiK’s Incident Response Team at qrt@certik.com.