Merge pull request #638 from morpho-org/fix/liquidation

fix liquidation rounding
morpho-org · Dec 12, 2023 · d98b26c · d98b26c
2 parents dc76917 + cc70d77
commit d98b26c
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Showing 3 changed files with 32 additions and 9 deletions.
diff --git a/.github/workflows/foundry.yml b/.github/workflows/foundry.yml
@@ -39,7 +39,7 @@ jobs:
         uses: foundry-rs/foundry-toolchain@v1
 
       - name: Run Forge tests in ${{ matrix.type }} mode
-        run: forge test -vvv
+        run: yarn test:forge -vvv
         env:
           FOUNDRY_FUZZ_RUNS: ${{ matrix.fuzz-runs }}
           FOUNDRY_FUZZ_MAX_TEST_REJECTS: ${{ matrix.max-test-rejects }}

diff --git a/src/Morpho.sol b/src/Morpho.sol
@@ -357,7 +357,6 @@ contract Morpho is IMorphoStaticTyping {
 
         _accrueInterest(marketParams, id);
 
-        uint256 repaidAssets;
         {
             uint256 collateralPrice = IOracle(marketParams.oracle).price();
 
@@ -370,15 +369,15 @@ contract Morpho is IMorphoStaticTyping {
             );
 
             if (seizedAssets > 0) {
-                repaidAssets =
+                uint256 temp =
                     seizedAssets.mulDivUp(collateralPrice, ORACLE_PRICE_SCALE).wDivUp(liquidationIncentiveFactor);
-                repaidShares = repaidAssets.toSharesDown(market[id].totalBorrowAssets, market[id].totalBorrowShares);
+                repaidShares = temp.toSharesDown(market[id].totalBorrowAssets, market[id].totalBorrowShares);
             } else {
-                repaidAssets = repaidShares.toAssetsUp(market[id].totalBorrowAssets, market[id].totalBorrowShares);
-                seizedAssets =
-                    repaidAssets.wMulDown(liquidationIncentiveFactor).mulDivDown(ORACLE_PRICE_SCALE, collateralPrice);
+                seizedAssets = repaidShares.toAssetsDown(market[id].totalBorrowAssets, market[id].totalBorrowShares)
+                    .wMulDown(liquidationIncentiveFactor).mulDivDown(ORACLE_PRICE_SCALE, collateralPrice);
             }
         }
+        uint256 repaidAssets = repaidShares.toAssetsUp(market[id].totalBorrowAssets, market[id].totalBorrowShares);
 
         position[id][borrower].borrowShares -= repaidShares.toUint128();
         market[id].totalBorrowShares -= repaidShares.toUint128();

diff --git a/test/forge/integration/LiquidateIntegrationTest.sol b/test/forge/integration/LiquidateIntegrationTest.sol
@@ -206,8 +206,8 @@ contract LiquidateIntegrationTest is BaseTest {
         sharesRepaid = bound(sharesRepaid, 1, Math.min(borrowShares, maxSharesRepaid));
 
         uint256 expectedRepaid = sharesRepaid.toAssetsUp(morpho.totalBorrowAssets(id), morpho.totalBorrowShares(id));
-        uint256 expectedSeized =
-            expectedRepaid.wMulDown(liquidationIncentiveFactor).mulDivDown(ORACLE_PRICE_SCALE, params.priceCollateral);
+        uint256 expectedSeized = sharesRepaid.toAssetsDown(morpho.totalBorrowAssets(id), morpho.totalBorrowShares(id))
+            .wMulDown(liquidationIncentiveFactor).mulDivDown(ORACLE_PRICE_SCALE, params.priceCollateral);
 
         loanToken.setBalance(LIQUIDATOR, params.amountBorrowed);
 
@@ -354,4 +354,28 @@ contract LiquidateIntegrationTest is BaseTest {
         vm.prank(LIQUIDATOR);
         morpho.liquidate(marketParams, BORROWER, collateralAmount, 0, hex"");
     }
+
+    function testSeizedAssetsRoundUp() public {
+        _setLltv(0.75e18);
+        _supply(100e18);
+
+        uint256 amountCollateral = 400;
+        uint256 amountBorrowed = 300;
+        collateralToken.setBalance(BORROWER, amountCollateral);
+
+        vm.startPrank(BORROWER);
+        morpho.supplyCollateral(marketParams, amountCollateral, BORROWER, hex"");
+        morpho.borrow(marketParams, amountBorrowed, 0, BORROWER, BORROWER);
+        vm.stopPrank();
+
+        oracle.setPrice(ORACLE_PRICE_SCALE - 0.01e18);
+
+        loanToken.setBalance(LIQUIDATOR, amountBorrowed);
+
+        vm.prank(LIQUIDATOR);
+        (uint256 seizedAssets, uint256 repaidAssets) = morpho.liquidate(marketParams, BORROWER, 0, 1, hex"");
+
+        assertEq(seizedAssets, 0, "seizedAssets");
+        assertEq(repaidAssets, 1, "repaidAssets");
+    }
 }