Description

Since the markets have delayed settlements to mitigate arbitrage, the positions opened by users are settled at a later price. Under normal circumstances, the difference in price between when a position is opened and when it is settled should be fairly small. However, volatility in the price feed can cause unexpected fluctuations.

Preventing unexpected losses requires a slippage-protection mechanism.

Impact

Users may lose funds due to unexpected volatility given the lack of a slippage-protection mechanism.

Recommendations

Slippage protection could be implemented at the oracle-level. While making a version invalid might be difficult, one simple way to handle it would be to cancel trades if the price difference between two versions exceeds a certain threshold. Adding an additional unsafe flag that users can set would keep it usable for users who want to bypass this protection.

Remediation