Paper 2022/445
TWAP Oracle Attacks: Easier Done than Said?
Torgin Mackinga, Tejaswi Nadahalli, and Roger Wattenhofer
Abstract
Blockchain ``on-chain'' oracles are critical to the functioning of many Decentralized Finance (DeFi) protocols. We analyze these oracles for manipulation resistance. Specifically, we analyze the cost of manipulating on-chain time-weighted average price (TWAP) oracles that use the arithmetic mean. It has been assumed that manipulating a TWAP oracle with the well-known multi-block attack is expensive and scales linearly with the length of the TWAP. We question this assumption with two novel results. First, we describe a single-block attack that works under the same setting as the multi-block attack but costs less to execute. Second, we describe a multi-block MEV (MMEV) style attack where the attacker colludes with a miner/proposer who can mine/propose two blocks in a row. This MMEV style attack makes oracle manipulation orders of magnitude cheaper than previously known attacks. In the proof-of-work setting, MMEV can be done by selfish mining even with very low shares of hashpower.
Metadata
- Available format(s)
-
PDF
- Category
- Cryptographic protocols
- Publication info
- Published elsewhere. ICBC 2022
- Keywords
- TWAP OraclesMEVDeFi
- Contact author(s)
- tejaswin @ ethz ch
- History
- 2022-04-12: received
- Short URL
- https://ia.cr/2022/445
- License
-
CC BY
BibTeX
@misc{cryptoeprint:2022/445,
author = {Torgin Mackinga and Tejaswi Nadahalli and Roger Wattenhofer},
title = {{TWAP} Oracle Attacks: Easier Done than Said?},
howpublished = {Cryptology {ePrint} Archive, Paper 2022/445},
year = {2022},
url = {https://eprint.iacr.org/2022/445}
}
