By Nathan Ferguson
The automatic computer programs that operate on the blockchain network after certain conditions are fulfilled are known as smart contracts. The worth of smart contracts may range from worth millions to billions of dollars. These computer programs can be simple to operate or complicated.
Properly deploying smart contracts is essential. Once the contract is deployed in public, it is available to all making it a public source. However, the scammer can take advantage of any bug found in the system. Therefore, ignoring the security of the network is not an option. Moreover, the code of the smart contracts cannot be modified after deployment. Therefore, one has to take security measures beforehand.
In this guide article, we will learn the procedure of smart contract verification and its importance in the system.
Working of Smart Contract Verification
Presenting the logical and desired smart contract behavior as mathematical statements are called the verification of smart contracts. In order to check the correctness of these statements, automated tools are usually used by auditors.
The process of verification of smart contracts involves the following steps. It explains the desired properties and specifications of the contract in formal language. Moreover, it translates the code of contract into any mathematical logic or model to represent it formally.
The specifications and properties of the contract are validated through a model checker and automated theorem provers. However, the verification process can be repeated to sort out any errors or bugs.
Importance of Smart Contract Verification
In order to make sure that smart contracts are free from all kinds of vulnerabilities, illicit behavior, errors, and bugs, they use logical reasoning. Moreover, it builds confidence and trust among the users as the characteristics of the smart contracts defined have proved true with time.
A few examples of smart contract verification are discussed below.
Uniswap is a reputable automated machine maker. The smart contract Uniswap V1 was formally verified as soon as it was developed. Before releasing it in the market, the rounding errors of the smart contract were found and fixed. It might cause the drainage of funds for Uniswap V1.
- Balancer
Another formal verification was carried out for Balancer V2. The incorrect calculation of charges through formal verification was detected through this verification. These calculations involve the functionality of flash loan in smart contracts that increases the probability of theft in an exchange.
After the deployment of SafeMoon V1, a bug was found after the formal verification. Any owner of the smart contract can discard the ownership of the smart contract and acquire it again later. For this purpose, certain operations were required to be completed to eliminate the ownership.
However, the manual audits of SafeMoon missed the bug. This is because it required multiple combinations of different programs. Humans can easily miss such errors; however, machines can easily pick them up.
Simultaneous Working of Formal Verification and Manual Auditing
According to their required properties, the logic and behavior associated with all smart contracts can be detected through formal verification. It is an automatic and systematic verification procedure. It provides a convenient method for identifying and fixing all errors and bugs in the system. It assists in figuring out the subtle and complicated issues in the system that cannot be otherwise detected manually.
On the other hand, a detailed expert review regarding the design, code, and deployment of the smart contract is carried out in manual auditing. The security risks involved in the system and the overall posture of the system’s security mechanism are identified by the auditor. Moreover, they also sort out all the issues that cannot be detected through automatic tools and check if the process was carried out correctly.
Conclusion
It is crucial to utilize manual auditing and smart contract verification to ensure the detailed evaluation of security mechanisms. The contracts that might own multiple risk factors can be verified thoroughly, making them free from all vulnerabilities and scams.
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