Vulnerability: Contestation Period Manipulation in Hydra Layer-Two Scalability Solution for Cardano

CVE-2023-42448 · HIGH Severity

CVSS:3.1/AV:N/AC:L/PR:L/UI:N/S:U/C:N/I:H/A:H

Hydra is the layer-two scalability solution for Cardano. Prior to version 0.13.0, the specification states that the contestation period in the datum of the UTxO at the head validator must stay unchanged as the state progresses from Open to Closed (Close transaction), but no such check appears to be performed in the `checkClose` function of the head validator. This would allow a malicious participant to modify the contestation deadline of the head to either allow them to fanout the head without giving another participant the chance to contest, or prevent any participant from ever redistributing the funds locked in the head via a fan-out. Version 0.13.0 contains a patch for this issue.

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