Possibles share-price inflation

The vault will be initialized with a seed deposit by the TempleDAO team, but in the event that it is not, there are possible pathways to an inflated share price. This could be enabled by several factors:

• Truncation caused by a change in the reserve/share, possibly due to fluctuations in the oracle price.

• Exit-fee donation — a user could repeatedly inflate the share price by entering and exiting, inflating the share price by 1.005x each time.

However, these conditions come with the prerequisite that the vault must initially be empty; otherwise, the attacker is only donating their reserves to other vault participants. This is not possible as the TempleDAO team will be seeding their vaults with a seed deposit.

Even in the case the vault's share price becomes inflated, the only attack rendered viable is a variant of the first deposit attack where the share price can be increased to a point to cause a truncation in a following victim's deposit such that a portion of the deposit is stolen. However, this is thwarted by slippage checks that revert if a user does not receive the expected amount of share back; therefore, it would only be viable if the share price were inflated and the victim did not correctly set their slippage parameter.