Best viewed in Obsidian

Reviews every important function and its call trace

- BorrowingModule ^BorrowingModule

• touch -- [[#^Base-initOperation]] (update storage: accum + lastUpdated, fees, shares, borrows), set a snapshot. (After the call it will be all checked on EVC)
  • How is a snapshot used? [[#^Base-snapshot]]
    • checkVaultStatus [[#^RiskManager-checkVaultStatus]]
• flashLoan -- get acc (msg.sender or ~msg.sender), send all the balance to acc, callback, check balance
  • Is a nonReentrant modifier inherited? -- no, but since we do delegateCall it will be used
    • Why no events!? -- didn't do delegate
• repayWithShares -- burn ~msg.sender's shares, reduce receiver's debt
  • decreaseBorrow -- reduce user's owed, update his interestAccumulator, update totalBorrows, log
    • vaultCache.totalBorrows > owedExact -- if totalBorrows (by all users) > borrowed by THIS user (before repay)
    • setUserBorrow -- update both owed and interestAccumulator
    • Owed owedRemaining = owed.subUnchecked(assets).toOwed() -- debt remaining after repay
      • owed -- owed now, by receiver, rounded up to Assets
      • assets -- user requested value, [1, owed]
      • toOwed -- just add 31 0s
    • loadUserBorrow [[#^BorrowUtils-loadUserBorrow]]
    • When assets > owed? -- requested amount > owed. But it also checked in repayWithShares and reset to owed in this case. Probably impossible in this case, maybe in others it's possible
      • owed in decreaseBorrow -- owed now, rounded up
      • assets -- either all shares price, or requested amount (both rounded up)
      • owed in repayWithShares -- same, but rerequested
      • Can there be any updates in between owed? -- only balanceTracker, which is trusted, I assume
        • decreaseBalance -- nope
          • setOwed?
          • interestAccumulator?
  • decreaseBalance -- decrease shares balance for user (~msg.sender), decrease totalShares both storage and cache, trigger balanceForwarder hook, emit events
    • Why account, sender, receiver are all the same? -- sender, receiver just for a withdraw event
    • balanceTrackerHook
      • How to add enabledRewards?
    • getBalanceAndBalanceForwarder -- balance shares + is forwarder set
      • unpackBalance
      • unpackBalanceForwarder
  • getBalance -- return shares, max = uint112.max shares, last 112 bits in the slot
  • When assets > owed? -- user requested value
• repay -- transfer assets to address(this)=Vault from ~msg.sender, decrease borrow of receiver (custom param)
  • pullAssets -- transfer from account to address(this)=Vault
    • Hmm, won't it allow to pull from anyone who approved the vault? -- nope, because check for account from EVC
    • permit2, what is it -- Uniswap contract, allows to approve in a batch, one network tx, several ops, signatures too
      • safeTransferFrom -- try to transfer, otherwise use permit2
        • Permit2 -- allows to approve in a batch, one network tx, several ops
        • trySafeTransferFrom -- try transfer, but return false instead of revert
• borrow -- increase debt for ~msg.sender, transfer assets to a receiver
  • increaseBorrow -- set new owed for a user + totalBorrows (cache, storage) + log
  • pushAssets -- transferTo to
    • safeTransfer(custom) -- almost standard, but does not check if contract exists
• pullDebt -- any user can get debt from anyone else
  • initOperation [[#^Base-initOperation]]
  • transferBorrow [[#^Borrowing-transferBorrow]]
    • We possibly did assetsUp, can we still transfer? -- Yes, dust will be ignored
• interestRate -> computeInterestRateView
  • What's IRM? -- basically just provides the current rate. To grow interestAccumulator => totalOwed and totalBorrows
    • Where is the rate used? -- main: interestAccumulator grows => totalOwed; + totalBorrows
      • Main: on Cache update, to get multiplier, to increase interestAccumulator and totalBorrows
        • Where is interestAccumulator used? -- mostly to get currently owed amount, grows constantly
          • setUserBorrow <- increase, decrease, transfer borrow
          • logVaultStatus <- initialize, setInterestFee, setInterestRateModel, [[#^RiskManager-checkVaultStatus]]
          • getCurrentOwed <-
            • debtOf <- DToken.balanceOf <- X
            • debtOfExact <- X
            • repay <- X
            • repayWithShares <- X
            • pullDebt <- X
            • calculateLiquidation <- ^calculateLiquidation
              • checkLiquidation <- X
              • liquidate <- X
            • getLiabilityValue <- ^LiquidityUtils-getLiabilityValue
              • accountLiquidityFull <- X
              • calculateLiquidity <-
                • calculateMaxLiquidation
                  • calculateLiquidation [[#^calculateLiquidation]]
                • accountLiquidity <- X
              • checkLiquidity <- checkAccountStatus <- EVC.*
      • computeInterestRateView
        • Borrowing.interestRate // no inner usages
      • computeInterestRate -- used in checkVaultStatus (end of call/batch, in liquidation, initOperation (maybe not, maybe always deferred)), setInterestRateModel
        • RiskManager.checkVaultStatus ^RiskManager-checkVaultStatus
          • (related [[#^EVCcheckVaultStatus]] )
          • EVC.checkVaultStatusInternal -- end of call/batch, in liquidation, initOperation
            • How come it checks if not deferred in both call and initOperation? Something with context? -- yes, it saves context in memory, then set deferred in storage. So next calls will have deferred true, but current context (top-level) is not
            • EVC.requireVaultStatusCheckInternal -- see above, in initOperation + end of call, batch, executeLiquidation
              • EVC.requireVaultStatusCheckInternalNonReentrantChecks -- on initOperation, if not deferred
                • How do we set a flag to defer? -- in the beginning of a call, batch, controlCollateral, revertBatch
                • How do we remove that flag? -- probably no way
                • EVC.requireVaultStatusCheck
                • EVC.requireAccountAndVaultStatusCheck
              • EVC.checkStatusAll <- EVC.restoreExecutionContext -- end of call, batch and executeLiquidation ^EVC-checkStatusAll
                • EVC.call -- outside
                • EVC.batch -- outside
                • EVC.controlCollateral -- execute liquidation
                  • EVCClient.enforceCollateralTransfer
                  • executeLiquidation [[#^executeLiquidation]]
            • checkStatusAllWithResult -- for batch sim
              • batchRevert
                • batchSimulation
      • Governance.setInterestRateModel
  • IRMLinearKink.computeInterestRateInternal -- while utilization is normal use utilization ✕ slope1, when > kink add utilizationOverKink ✕ slope2
  • IRMSynth.computeInterestRateInternal
    • What is a rate? -- when you borrow, how much per year you will pay in interest (at least current understanding, should get better with understanding BorrowingModule)
    • _computeRate -- change rate 10%
      • if less than 1hr passed since last update => noop
      • if > 1hr => either increase 10% or decrease 10%, capped by max/min
  • isVaultStatusCheckDeferred -- did we call initOperation => added vault (and possibly controller) to the set for deferred checks
    • evc.isVaultStatusCheckDeferred -- vaultStatusChecks.contains(vault)
      • Where is it added to vaultStatusChecks?
        • requireVaultStatusCheck()//msg.sender
          • EVCRequireStatusChecks
            • initOperation
        • requireAccountAndVaultStatusCheck//provided value + msg.sender
          • Same fn, EVCRequireStatusChecks
• debtOf
  • getCurrentOwed -- fresh owed + accruedInterest [[#^getCurrentOwed--howUpdated]] + [[#^c126db]]
• cash -- amount not borrowed, balanceOf(vault)
• totalBorrows -- self-explanatory name, round up
  • loadVault -- just [[#^initVaultCache]]
  • nonReentrantView -- if reentrancyLocked allow only hookTarget calls
    • useViewCaller? -- a mechanism that sets caller to calldata, adds to the end
      • Where are the last 20 bytes set? -- useView => delegateToModuleView
        • viewDelegate -- workaround to delegatecall a view function. strips [selector 4B][module address 32B][original selector 4B][customData 32B][caller address 20B]
          • let size := sub(calldatasize(), 36). Why 36? -- selector + module address, leave only real calldata

- LiquidationModule.liquidate -- basically what's said in executeLiquidation: "transfer debt, then collateral. Possibly forgive bad debt" ^LiquidationModule-liquidate

• Base.initOperation - prepare cache + update storage, get account, check hook, set deferred checks ^Base-initOperation
  • snapshotInitialized - flag that says that we need to do checks of borrowCap and supplyCap on checkVaultStatus ^Base-snapshot
    • What kind of checks? -- borrows < cap or < prev, same for supply
      • What's onlyEVCChecks -- basically allowed only during a certain evc state, checks in progress, several possible reasons, including restoreExecutionContext
        • areChecksInProgress? -- skipped, don't want to go too deep rn
          • set in restoreExecutionContext and nonReentrantChecksAcquireLock
    • set to true in initOp
    • set to false in checkVaultStatus, called by EVC on vault status check
  • EVCRequireStatusChecks -- adds vault and account to sets, that will be checked in the end of EVC.call ^evcCallDeferred
    • requireVaultStatusCheck -- adds to a set that will be checked in the end of a call
      • areChecksDeferred in case of liquidation? -- yes, because it's called through EVC
    • requireAccountAndVaultStatusCheck -- also adds to sets account and vault(msg.sender)
    • What's accountToCheck? -- caller, none, from
    • What's CHECKACCOUNT_CALLER? -- special variable that says that we need to check caller instead of accountToCheck
  • callHook -- just call the hook if set for OP
    • invokeHookTarget -- just call the hook with msg.data (all calldata, including msg.sig)
      • What is a hook for? Just to check if reverts? -- yes
    • How operations work? -- bitwise map
    • How hookedOps are set -- by governor, set one target for all operations
  • EVCAuthenticateDeferred -- get caller from EVC
    • getCurrentOnBehalfOfAccount
  • Cache.updateVault -- initVaultCache (below), but then write to storage ^updateVault
    • Cache.initVaultCache -- load vault from storage to memory; update totalBorrow, interest, totalShares and fees ^initVaultCache
      • resolve -- last 6 bits is the power (max 63), first 10 bits/100 is mantissa, 0-10. {0.0-1.0}^{0-63}
        • amountCap & 63 -- last 6 bits
        • Why divided by 100? -- probably because they want it to be <1, and 1023 is a max value
          • scale factor, but why? maybe because when we
        • set by government only
      • if (feeAssets != 0) -- update newTotalShares and newAccumulatedFees
        • vaultCache.cash -- balanceOf vault (but of course it's written on every op)
        • OwedLib.toAssetsUpUint(newTotalBorrows) -- just round up and /1e31
      • feeAssets = borrow grow diff x fee
        • How is an interestFee set? -- is it really 35 shift precision// Yep
      • What is happening inside unchecked -- update newInterestAccumulator and newTotalBorrows if not overflow
        • What is happening in if(!overflow) -- update newInterestAccumulator, unless overflows
        • What do we do when overflow? -- use the old one
        • newTotalBorrows = intermediate / vaultCache.interestAccumulator
      • What's rpow? (x / 1e27)**n * 1e27 (x^n with 1e27 precision)
      • ProxyUtils.metadata() -- just returns last 3 addresses from calldata, added by proxy
        • Isn't anyone can pass any data? -- Yes, but it should be fine, because we only read the first bytes in solidity, and last bytes in the end
          • But it means that if we pass only one parameter solidity will see 60 more bytes in the end (maybe if call in a loop or something?) Later
          • How does proxy work? -- adds metadata to the end of every call
          • What is the order of modifiers? -- From left to right? Yep

            modifier callThroughEVC() {
              if (msg.sender == address(evc)) {
                use(MODULE_LIQUIDATION);
              } else {
                callThroughEVCInternal();
              }
            }
            

            callThroughEVC -> callThroughEVCInternal => EVC.call => use(MODULE_LIQUIDATION) -> Liquidation.liquidation
          • Does callThroughEVCInternal add the calldata 3 addresses in the end?
            • No, it's added by calling a proxy
          • What if we call EVC.call or something, will it also add calldata? -- No, it's not a proxy. But when it calls a proxy, calldata is added automatically in the end before delegatecall
          • diff between metaproxy and beacon proxy, I remember it was some bug about it, when can initialize beacon or something, so the calls go to another address
• LiquidationModule.calculateLiquidation -- check collateral, controller, coolOff. Calculate repay(debt)/yield(col.) capped by desiredRepay (must be also < maxRepay (debt))
  • How does desiredRepay work? -- revert if > max, scale yield(collateral) otherwise
  • calculateMaxLiquidation -- max 1 collateral received for a given debt, all scaled depending on balance, not necessarily full debt or collateral
    • Summary: request all collateral and debt, calculate discountFactor (the more underwater, the bigger the discount), depending on 1 collateral value and debt calculate how much max can repay to get yieldBalance of collateral
    • liqCache.repay -- amount debt to repay max, no more than 1 collateral value
    • yieldBalance -- amount collateral to receive max, no more than debt
    • maxRepayValue, maxYieldValue? -- max liability to cover (either all or scaled to collateral), max collateral to get (either all or scaled to liability)
    • Is collateral always a vault? -- yes! If liquidation is enabled
    • getQuote works with shares alright? -- should be alright if they use Router
      • Do they use a router?
        • Read readme
    • What's collateralBalance -- balanceOf shares for the violator
      • How is it used?
        • If it's not always a vault, how can we seize it then? -- we can't, unless a violator is a vault
          • Maybe it gives full approve when adding the tokens? -- no, we want it to be a vault
          • Who is a violator? -- just address
          • is it always a vault? -- no!
            • How is targetTimestamp set (it is checked to make sure collateral is allowed)? -- in setLTV
      • Does balanceOf return shares? -- yes
      • What's liqCache.collateral -- collateral to be seized, checked to be a valid one
    • What's discountFactor? -- 1 - discount, so factor is 90% for 10% discount
      • minDiscountFactor? -- 1 - maxLiquidationDiscount
        • What's maxLiquidationDiscount? -- max discount on liquidated guy's collateral
          • What's the default value? -- maybe 11% in tests
    • calculateLiquidity -- collateral, liability in UoA
      • getLiabilityValue -- return owed+interest in unitOfAccount
        • Is collateral also in unitOfAccount? -- yes
        • if (address(vaultCache.asset) == vaultCache.unitOfAccount) { -- if accounting is in asset's prices
          • unitOfAccount is? -- a coin we use as base (USDC, USDT, ETH)
        • getCurrentOwed -- owed + accrued interest [[#^c126db]]
          • vaultStorage.users[account].getOwed() -- changes on borrow
            • interestAccumulator for user [[#^a6613d]]
            • Why in initVaultCache it uses time and saves totalBorrows, can't it get out of sync? -- probably not on the first glance, but I may check later
            • Where did I see a similar mechanism, but with an accumulator and time update on change? -- Because here it does not change it seems -- initVaultCache
            • Changes on borrow change
            • Owed amount
      • getCollateralValue -- if no ltv or balance return 0, otherwise ask oracle the price adjusted by ltv
        • oracle.getQuote -- either ask an oracle directly (through adapter) or use router first
          • How does the oracle work? -- finds an oracle to ask, then asks
            • I don't understand, what kind of oracle will be used if there are several collaterals? -- probably router, no other way around
            • Watch the video?
        • !Why do we use balanceOf -- in docs yes, but I see no checks
          • !is collateral always vault? -- in docs yes, but I see no checks
        • LTVUtils.getLTV -- return LTV using ramping formula
          • LTVConfig.getLTV -- return LTV using ramping formula
            • What's borrowLTV -- loan to value you need on borrow
            • What is self.liquidationLTV and self.initialLiquidationLTV? -- current and previous LTVs, needed in case of ramp period
            • self.targetTimestamp -- how is it set? -- when new LTV is set by the governor, now + rampDuration
            • How LTVConfig param is set? -- ltvLookup[collateral], which is set by governor
              • How vaultStorage.ltvLookup[collateral] is set? -- setLTV is called by governor
  • EVC.getCollaterals -- get vaults added as collaterals by the user
    • EVC.accountCollaterals -- vaults, can be added and removed by user, on add/remove checks controller's status
  • getCurrentOwed -- owed + accrued interest ^c126db
    • vaultStorage.users[account].interestAccumulator -- on each borrow update it's updated. And nowhere else ^a6613d
      • setUserBorrow -- from cache
• LiquidationModule.executeLiquidation -- transfer debt, then collateral. Possibly forgive bad debt (no collateral + flag + liability left) ^executeLiquidation
  • liqCache.liability > liqCache.repay -- not all paid
    • liability -- owed + interest = owedRightNow
    • repay -- real repay
  • CFG_DONT_SOCIALIZE_DEBT usage -- only for socializing debt in one place
  • enforceCollateralTransfer -- transfer collateral from violator to liquidator (use impersonation on EVC)
    • controlCollateral -- call target onBehalfOfAccount with data
      • notice -- check controller is calling, check is his collateral, call collateral vault to transfer funds (impersonating violator)
      • dev -- iiuc just says that we will either check in the end or continue if deferred
  • forgiveAccountStatusCheck -- just removes account from checks Set in evc
  • what's yieldBalance -- profit for liquidator
  • transferBorrow -- allow to transfer <= than owed, but not >. Round dust. Set new owed value in from and to. Log ^Borrowing-transferBorrow
    • logBorrow -- interest is zero, log borrow and Dtoken transfer from 0 address
    • if (assets + toPrevAssets > toAssets) assets = toAssets - toPrevAssets; -- final: if requested > received (dust was cut), requested = diff
      • Was interest transferred? -- it's possible, but it doesn't matter, we transfer from from, and we discuss to now
        • Let's assume assets = 0, even so impossible
          • Can it really be 0? -- no
    • logRepay -- just log interest accrued, repay amt and Dtoken transfer
      • Why InterestAccrued = debtLeft + transfer? -- see comment in logRepay or copy below
        • // Note: on transfer: debtLeft + debtRepaid - debtWrittenOnBorrow
          • // debtLeft = debtWrittenOnBorrow + interest - debtRepaid
          • // if we replace debtRepaid and debtWrittenOnBorrow cancels, and we are left with interest
      • Why assets, not amount? -- transfer assets, amount is more precise and need to be rounded anyway
        • What's assets? -- just values passed to the fn
        • What's amount? -- more precise assets, possibly a little more or a little less because dust is added/removed. E.g. assets = 100, amt = 100.1 or 99.9
        • Where do we make an actual transfer? -- setUserBorrow, just add/remove amount
        • So 1 wei error possible? And how?
          • from = 200.1(round up 201), transfer 200, balance becomes 0, 1 wei lost
      • Why toAssetsUp? -- exactly to fix the issue with rounding when we save amount=fromOwed
      • logDToken -- emit transfer event on diff, from/to address(0)
        • How is it deployed? -- in initialize
        • calculateDTokenAddress -- basically it expects that DToken was deployed from this contract with nonce 1, and then calculates using rlp encoding, and kind of gas efficient
          • Find CREATE3 explainer
            • https://0xmacintosh.ca/docs/skill/blockchain/ethereum/contract-creation/ + https://ethereum.org/en/developers/docs/data-structures-and-encoding/rlp/ + remix
    • setUserBorrow -- update owed to debtLeftUnpaid, update interestAccumulator ^BorrowUtils-setUserBorrow
    • fromOwed = fromOwed.subUnchecked(amount); -- debtLeftUnpaid
    • First if -- if diff(amt(repay), fromOwed(violatorDebt)) < dust consider them equal
      • Is owedByViolator scaled? or just assets -- just assets
      • (amount > fromOwed && amount.subUnchecked(fromOwed).isDust()) -- diff < dust
        • isDust -- < (1<<31) => would be cut in case of shift back to assets
        • What is amount? -- = liqCache.repay -- debt that will be repaid
        • What is fromOwed? -- how much is owed now, in Owed assets
          • How is it different from .liability? -- liability is rounded up, and it's in assets, this one is exact, in Owed (more precise) but overall is the same
            • Why round up? -- transform from Owed
        • Is amount rounded? -- no
        • Is fromOwed rounded? -- no
    • loadUserBorrow -- load prevOwed (on borrow ops), getCurrentOwed (is freshly calculated) ^BorrowUtils-loadUserBorrow
      • Why prevOwed and getCurrentOwed is different? -- prevOwed on borrow ops, getCurrentOwed is freshly calculated
        • How vaultStorage.users[account] owed updated? -- using setUserBorrow => increase, decrease, transfer borrow
        • How getCurrentOwed updated? -- owed on borrow + accrued interest (diff between current accum and on last borrow) ^getCurrentOwed--howUpdated
          • How Cache.interestAccumulator updated? -- depending on time passed grow accordingly, depending on interestRate (set in storage)
            • Is it always updated before getCurrentOwed is called? -- yes
              • debtOf -- loadVault is called inside, +
              • debtOfExact -- loadVault is called inside, +
              • repay -- initOperation <= updateVualt is called, +
              • repayWithShares -- initOperation <= updateVualt is called, +
              • pullDebt -- initOperation <= updateVualt is called, +
              • calculateLiquidation -- initOperation <= updateVualt is called, +
              • loadUserBorrow
                • increaseBorrow -- initOperation <= updateVualt is called, +
                • decreaseBorrow -- initOperation <= updateVualt is called, +
                • transferBorrow -- initOperation <= updateVualt is called, +
              • getLiabilityValue, +
            • How is interestRate updated? -- computeInterestRate -- on setInterestRateModel (governor), checkVaultStatus
      • getOwed -- unpack owed: use a mask on slot, cut the unused last 112 bits
      • getCurrentOwed -- freshly calculated
      • Does borrow ops update the accumulator with fresh rate on save? -- yes, all incr, decr, transfer
    • How are violator, liquidator set?
      • violator -- passed as param
      • liquidator -- from initOperation, should be handled by EVC
    • toOwed how does it work? -- basically just scale <<31
      • Why << INTERNAL_DEBT_PRECISION_SHIFT?
        • Why not 32? -- I think just to have some gap, it's not that important I guess