isabella232 / exchange-callees

Exchange Callee contracts for LIQ2.0 Flash Loans

Exchange Callees

This repository contains exchange callee contracts, which wrap around decentralized exchanges and interact with the Maker Protocol. They are used in conjunction with the auction-demo-keeper to demonstrate flash loan functionality within LIQ2.0's collateral auctions.

With built-in flash loans, auction participants can accept a collateral advance from LIQ2.0, send it to an exchange callee contract to be traded for Dai, forward any Dai profit to an external address, and pay back the auction - all in a single transaction. In terms of capital, the participant only needs ETH to pay for gas costs.

NOTE: These contracts are intended as a code example, and have not been audited or tested in a production environment.

Architecture

Each exchange has its own public callee contract, which exposes a function called clipperCall(owe,slice,data). This method is called by the Clipper contract, the collateral auction house of LIQ2.0. After receiving internal gem (i.e. collateral) from Clipper, it conducts the following steps:

1. Converts internal gem to ERC20 gem
2. Approves exchange to pull ERC20 gem
3. Trades ERC20 gem for ERC20 dai
4. Forwards any ERC20 gem (if present) to external address
5. Converts ERC20 dai to internal dai and sends to msg.sender
6. Forwards ERC20 dai profit (if present) to external address
7. Sends internal dai to Clipper for repayment (occurs in Clipper.take)

NOTE:

• NEVER DIRECTLY SEND internal/ERC20 gem/dai to an exchange callee contract.
• Remember to call vat.hope(clipper) from the msg.sender once before calling Clipper.take

Exchanges supported

• OasisDex
• UniswapV2 (Only ETH collateral types are supported at the moment)

Public addresses

Improvements

To slow down or defend against generalized frontrunning bots, consider:

• Deploying an ownable exchange-callee contract and add an auth modifier to clipperCall(), so only the owner (you) can call the function
• Using a mempool-shielded transaction service, as outlined in this blog post

Testing

Requires Dapptools

$ dapp update
$ dapp --use solc:0.6.12 test

Disclaimer

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