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Nexus Intelligence Research

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DeFi Smart Contract Vulnerabilities Audit Guide

Here are three specific, high-severity DeFi smart contract vulnerabilities commonly identified in professional security audits, described with technical precision suitable for inclusion in an audit report.


1. Reentrancy Vulnerability Due to Missing State Updates Before External Calls

Description:

A reentrancy vulnerability occurs when a smart contract calls an external contract (e.g., a token contract or another DeFi protocol) before completing all internal state changes. If the external contract contains malicious code that re-enters the victim contract’s function (via a callback mechanism such as onTokenReceived in ERC-777 or a custom interface), the attacker can exploit the intermediate state to perform the same transaction multiple times before the final state is updated.

Specific Scenario:

Consider a staking contract with a withdraw() function:


solidity
function withdraw(uint256 amount) external {
    require(balanceOf[msg.sender] >= amount, "Insufficient balance
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