Maia DAO Ecosystem - K42's results

Advanced Analysis Report for MaiaDAO

Overview

• Maia DAO is a decentralized autonomous organization that has developed a suite of protocols to increase capital efficiency and utility for its community. The Maia DAO ecosystem is made up of four protocols: Hermes, Maia, Talos, and Ulysses. Each of these protocols plays a unique role in the ecosystem.

• Understanding the Ecosystem: I started by familiarizing myself with the MaiaDAO ecosystem, each protocol serves a distinct purpose, and understanding their roles was crucial to analyzing the codebase.

• Codebase Quality Analysis: I reviewed the code for adherence to Solidity best practices, code readability, and documentation. The codebase is well-structured, and the code is generally clean and readable. The use of libraries and modular design patterns enhances the code's maintainability. However, there are areas where additional comments would be beneficial for understanding the code's functionality.

• Architecture Recommendations: The architecture of the MaiaDAO ecosystem is complex, given the interdependencies between the four protocols. The use of modular design patterns and libraries is commendable as it enhances code maintainability. However, the complexity of the system could potentially introduce unforeseen bugs or vulnerabilities. Regular audits and thorough testing are recommended to ensure the system's security.

• Centralization Risks: The MaiaDAO ecosystem appears to be decentralized, with governance mechanisms in place. However, it's important to note that the system's upgradeability features could potentially be exploited if the governance process is compromised.

• Mechanism Review: The mechanisms implemented in the MaiaDAO ecosystem, such as yield farming, liquidity provision, and cross-chain asset management, are complex and innovative. These mechanisms appear to be implemented correctly, but due to their complexity, they should be thoroughly tested and audited regularly.

• Systemic Risks: The MaiaDAO ecosystem's complexity and interdependencies could potentially introduce systemic risks. For example, a bug in one protocol could potentially affect the entire ecosystem. Regular audits and thorough testing are recommended to mitigate these risks.

Now, diving deeper into each protocol I learnt:

Hermes

Hermes provides significant improvements over its V1 version. It introduces a new model that includes three main ideas:

• Lockers direct emissions to gauges and receive the revenue of each gauge they vote for, proportional to the amount of votes for that gauge.
• Lockers can boost their liquidity farming rewards from gauges by up to 2.5x.
• Lockers receive rebases weekly proportional to inflation.

Hermes Protocol

• This protocol introduces a new gauge system that accepts any kind of yield. It also replaces the veNFTs with a permanent lock system, which simplifies the user experience. However, the permanent lock system could potentially discourage users who prefer more flexibility.

Maia

Maia is the first implementation of the Partner bHermes Vault. It allows users to stake their Maia, converting it to vMaia, and receive two of the three bHermes utilities deposited in the vault. These utilities are weight and governance.

Maia Protocol

• This protocol allows users to stake their Maia tokens and receive two of the three bHermes utilities. The third utility, boost, is used by Maia's Treasury to host a boost aggregator. This mechanism could potentially be gamed, so it should be thoroughly tested and audited.

Talos

Talos is a decentralized Uniswap V3 Liquidity Management protocol. It allows anyone to create and manage new LPs. These LPs always start 50/50 and if they have a manager, it can call two strategies: rebalancing and reranging.

Talos Protocol

• This protocol allows anyone to create and manage new LPs. While this enhances the system's decentralization, it could potentially be exploited by malicious actors. Therefore, appropriate safeguards should be implemented.

Ulysses

Ulysses is divided into two separate concepts: Virtualized and Unified Liquidity. Virtualized liquidity is made possible by using anycall v7 as the messaging layer. Unified Liquidity then unifies these tokens using a stableswap AMM and then depositing them in a Unified Liquidity Token, which is a Multi-Asset ERC4626 tokenized vault.

Ulysses Protocol

• This protocol introduces the concept of Virtualized and Unified Liquidity. This innovative mechanism allows users to deposit any asset from any chain and receive a 1:1 representation of the underlying assets. However, this mechanism's complexity could potentially introduce unforeseen bugs or vulnerabilities.

Areas of Concern

I have highlighted several areas of concern for the MaiaDAO ecosystem that require special attention now, and in future audits:

• Omnichain Accounting: The system needs to ensure accurate accounting across multiple chains. Any discrepancies or errors in this area could lead to significant issues.
• Omnichain Gas Management: Managing gas costs across multiple chains can be challenging. The system needs to ensure that it is efficient and cost-effective.
• Ulysses AMM and Token Accounting: The Ulysses Automated Market Maker (AMM) and token accounting systems need to be accurate and reliable. Any issues in these areas could impact the functionality of the system and the value of the tokens.
• Proper Reward/Bribe Management: The system needs to ensure that rewards and bribes are managed properly. This includes accurate calculation and distribution of rewards, as well as preventing any potential manipulation or gaming of the system.
• Brick Funds in Uniswap V3 Staker: The system needs to prevent any potential issues that could "brick" funds in the Uniswap V3 staker. This could include bugs, vulnerabilities, or other issues that could prevent users from accessing their funds.
• Game/Brick/Steal Funds from Talos Positions: The system needs to prevent any potential issues that could allow someone to game the system, brick funds, or steal funds from Talos positions.

These areas of concern should be a focus during further testing and auditing of the system. Any issues in these areas could have a significant impact on the functionality and security of the MaiaDAO ecosystem.

Codebase Analysis

The MaiaDAO codebase is extensive and covers a wide range of functionalities. It includes contracts for managing the different protocols, rewards systems, governance, and more. The codebase also includes libraries for handling various tasks, such as date and time operations, computing rewards, and managing token incentives.

The codebase is well-structured and modular, with clear separation of concerns. Each contract and library has a specific purpose and interacts with others to form the complete system. This modular approach makes the codebase easier to understand and maintain.

However, the complexity of the system also poses potential risks. With so many interacting components, there is a higher chance of unexpected behaviour or vulnerabilities. Therefore, thorough future testing and auditing are crucial to ensure the security of the system.

Recommendations

• Thorough Testing: Given the complexity of the system, it is crucial to conduct thorough testing to uncover any potential issues or vulnerabilities. This should include both unit tests for individual contracts and integration tests for the system as a whole.

• Code Review: Regular code reviews should be conducted to ensure that the code adheres to best practices and that any potential issues are identified and addressed promptly.

• Security Practices: Implement robust security practices, such as regular audits, thorough testing, and adherence to established smart contract development best practices.

• More interactive Documentation: Comprehensive documentation should be maintained to help developers and users understand the system. This should include detailed explanations of how each contract works, how they interact with each other, and how to use the system

• Codebase Organization: Given the extensive nature of the codebase, it is recommended to maintain a clear and organized structure. This includes proper naming conventions, clear comments, and logical organization of contracts and libraries.

• Community Engagement: Engage with the community to get feedback and identify potential issues. This can include bug bounty programs, open forums for discussion, and regular updates on development progress.

• Continuous Improvement: Regularly review and update the system to address potential issues, improve functionality, and adapt to changes in the wider ecosystem.

Contract Details

The MaiaDAO codebase includes a large number of contracts, each serving a specific purpose within the ecosystem. Here are some of the key contracts:

• Hermes: The Hermes contract is the native token for the Hermes Incentive System. It is an ERC20 token.

• Maia: The Maia contract is the native token for the Maia ecosystem. It is also an ERC20 token.

• FlywheelBoosterGaugeWeight: This contract is a Balance Booster Module for Flywheel.

• SingleRewardsDepot: This contract is for a single reward token storage.

• ERC20hTokenBranch: This contract is an ERC20 hToken Branch Contract.

• bHermesBoost: This contract earns rights to boosted Hermes yield.

• FlywheelBribeRewards: This contract manages the Flywheel Accumulated Bribes Reward Stream.

• FlywheelInstantRewards: This contract manages Flywheel Instant Rewards.

• FlywheelCoreInstant: This contract manages instant incentives distribution under the Flywheel Core system.

• FlywheelCoreStrategy: This contract is part of the Flywheel Core Incentives Manager.

These contracts interact with each other to form the complete MaiaDAO ecosystem. Each contract has a specific role and contributes to the overall functionality of the system.

Conclusion

MaiaDAO is a complex and innovative project that aims to increase capital efficiency and utility for its community. The project has a well-structured and extensive codebase, with a clear separation of concerns and a modular approach to development.

However, the complexity of the system also poses potential risks and challenges. It is crucial to conduct thorough testing and auditing to ensure the security of the system. Regular code reviews, robust security practices, and continuous improvement are also essential to maintain the integrity and functionality of the system.

The project also needs to engage with its community to get feedback and identify potential issues. This can include bug bounty programs, open forums for discussion, and regular updates on development progress.

Overall, MaiaDAO is a promising project with a lot of potential. With proper management and continuous improvement, it has the potential to make a significant impact in the DeFi space.

Time spent:

50 hours