LP-85: Security Audit Framework

Abstract

This LP establishes a comprehensive security audit framework for the Lux Network ecosystem, defining standards for smart contract audits, protocol security reviews, and ongoing security monitoring. The framework ensures consistent security practices across all Lux projects while providing clear guidelines for developers, auditors, and users.

Motivation

A standardized security framework is critical for:

Protocol Safety: Protecting user funds and data across all Lux chains
Developer Guidance: Clear security requirements for builders
Auditor Standards: Consistent criteria for security assessments
User Confidence: Transparent security practices and disclosures
Ecosystem Growth: Reducing security incidents that harm adoption

Specification

Security Audit Requirements

Audit Scope Classification

enum AuditScope {
  CRITICAL = "critical",      // Core protocol, bridges, custody
  HIGH = "high",             // DeFi protocols, token contracts
  MEDIUM = "medium",         // Governance, utilities
  LOW = "low",              // UI, non-financial contracts
}

interface AuditRequirements {
  scope: AuditScope;
  requiredAudits: number;
  auditTypes: AuditType[];
  updateFrequency: number;   // days between re-audits
  mandatoryTools: SecurityTool[];
}

enum AuditType {
  SMART_CONTRACT = "smart_contract",
  ECONOMIC = "economic",
  CRYPTOGRAPHIC = "cryptographic",
  OPERATIONAL = "operational",
  PENETRATION = "penetration",
}

Audit Process

interface AuditProcess {
  // Pre-audit requirements
  preAudit: {
    documentation: DocumentationRequirements;
    testCoverage: number;      // Minimum 95% for critical
    formalVerification?: boolean;
    threatModel: ThreatModel;
  };
  
  // Audit execution
  execution: {
    duration: number;          // Minimum days
    auditors: AuditorRequirements;
    methodology: AuditMethodology[];
    tools: SecurityTool[];
  };
  
  // Post-audit
  postAudit: {
    report: AuditReport;
    remediationPeriod: number; // Days to fix issues
    reaudit: boolean;
    disclosure: DisclosurePolicy;
  };
}

Vulnerability Classification

interface VulnerabilityClassification {
  severity: Severity;
  likelihood: Likelihood;
  impact: Impact;
  category: VulnerabilityCategory;
  cweId?: number;              // Common Weakness Enumeration
}

enum Severity {
  CRITICAL = "critical",       // Immediate risk of fund loss
  HIGH = "high",              // Potential fund loss or system compromise
  MEDIUM = "medium",          // Limited impact, requires specific conditions
  LOW = "low",               // Minor issues, best practices
  INFORMATIONAL = "info",     // No security impact
}

enum Likelihood {
  CERTAIN = "certain",        // Will definitely occur
  LIKELY = "likely",          // Probable under normal conditions
  POSSIBLE = "possible",      // Requires specific conditions
  UNLIKELY = "unlikely",      // Requires unusual conditions
  RARE = "rare",             // Highly specific scenario
}

interface SeverityMatrix {
  // CVSS-style scoring
  calculateScore(
    likelihood: Likelihood,
    impact: Impact
  ): number;  // 0.0 - 10.0
  
  // Risk rating
  getRiskRating(score: number): Severity;
}

Smart Contract Security Standards

interface ISecureContract {
  // Required security features
  function pause() external;
  function unpause() external;
  function isPaused() external view returns (bool);
  
  // Access control
  function hasRole(bytes32 role, address account) external view returns (bool);
  function getRoleAdmin(bytes32 role) external view returns (bytes32);
  
  // Upgrade safety (if upgradeable)
  function upgradeTo(address newImplementation) external;
  function implementation() external view returns (address);
  
  // Emergency functions
  function emergencyWithdraw(address token) external;
  function setEmergencyAdmin(address admin) external;
}

// Security modifiers
abstract contract SecurityBase {
  modifier nonReentrant() {
    require(!_reentrancyGuard, "Reentrancy");
    _reentrancyGuard = true;
    _;
    _reentrancyGuard = false;
  }
  
  modifier onlyWhitelisted() {
    require(whitelist[msg.sender], "Not whitelisted");
    _;
  }
  
  modifier rateLimit(uint256 maxCalls) {
    require(callCounts[msg.sender] < maxCalls, "Rate limited");
    callCounts[msg.sender]++;
    _;
  }
}

Multi-Chain Security

interface CrossChainSecurity {
  // Bridge security requirements
  bridgeSecurity: {
    multiSigThreshold: number;  // Minimum signers
    timeLock: number;          // Delay for large transfers
    dailyLimit: BigNumber;     // Maximum daily volume
    pauseThreshold: BigNumber; // Auto-pause on large drain
  };
  
  // Message verification
  messageValidation: {
    sourceVerification: VerificationMethod;
    replayProtection: boolean;
    orderingGuarantees: OrderingType;
    timeoutHandling: TimeoutPolicy;
  };
  
  // Chain-specific security
  chainRequirements: {
    [chainId: string]: {
      minConfirmations: number;
      reorgProtection: boolean;
      specificValidations: Validation[];
    };
  };
}

Incident Response

interface IncidentResponse {
  // Detection
  detection: {
    monitoring: MonitoringSystem[];
    alertThresholds: AlertThreshold[];
    anomalyDetection: AnomalyDetector;
  };
  
  // Response procedures
  response: {
    severityAssessment: SeverityAssessment;
    immediateActions: Action[];
    communicationPlan: CommunicationPlan;
    remediationSteps: Step[];
  };
  
  // Post-incident
  postIncident: {
    reportTemplate: IncidentReport;
    lessonsLearned: Review;
    protocolUpdates: Update[];
    compensation?: CompensationPolicy;
  };
}

interface EmergencyProcedures {
  // Circuit breakers
  circuitBreakers: {
    triggers: Trigger[];
    actions: EmergencyAction[];
    authorization: MultisigRequirement;
  };
  
  // War room
  warRoom: {
    participants: Role[];
    communication: Channel[];
    decisionProcess: DecisionTree;
  };
}

Continuous Security

interface ContinuousSecurity {
  // Monitoring
  monitoring: {
    onChainMonitoring: {
      contractEvents: EventMonitor[];
      stateChanges: StateMonitor[];
      balanceTracking: BalanceMonitor[];
    };
    
    offChainMonitoring: {
      apiEndpoints: EndpointMonitor[];
      infrastructureHealth: HealthCheck[];
      dependencyScanning: DependencyScanner;
    };
  };
  
  // Regular assessments
  assessments: {
    schedule: AssessmentSchedule;
    scope: AssessmentScope[];
    providers: SecurityProvider[];
  };
  
  // Bug bounty program
  bugBounty: {
    platform: BountyPlatform;
    rewards: RewardStructure;
    scope: BountyScope;
    rules: BountyRules;
  };
}

Security Tooling

interface SecurityToolRequirements {
  // Static analysis
  staticAnalysis: {
    required: Tool[];    // Slither, Mythril
    optional: Tool[];
    customRules: Rule[];
  };
  
  // Dynamic analysis
  dynamicAnalysis: {
    fuzzing: FuzzingConfig;
    symbolicExecution: SymbolicConfig;
    propertyTesting: PropertyTest[];
  };
  
  // Formal verification
  formalVerification: {
    required: boolean;
    properties: Property[];
    tools: FormalTool[];
  };
  
  // Manual review
  manualReview: {
    checklist: SecurityChecklist;
    reviewers: number;      // Minimum reviewers
    expertise: Expertise[];
  };
}

Audit Report Standards

interface AuditReport {
  // Executive summary
  summary: {
    scope: string;
    duration: DateRange;
    keyFindings: Finding[];
    overallAssessment: Assessment;
  };
  
  // Detailed findings
  findings: {
    vulnerabilities: Vulnerability[];
    recommendations: Recommendation[];
    bestPractices: Practice[];
    gasOptimizations: Optimization[];
  };
  
  // Technical details
  technical: {
    methodology: Methodology;
    toolsUsed: Tool[];
    testResults: TestResult[];
    codeQuality: QualityMetrics;
  };
  
  // Remediation
  remediation: {
    timeline: Timeline;
    fixes: Fix[];
    retestResults: TestResult[];
    signoff: Approval[];
  };
}

Disclosure Policy

interface DisclosurePolicy {
  // Responsible disclosure
  responsible: {
    reportingChannel: Channel;
    acknowledgmentTime: number;  // Hours
    fixDeadline: number;         // Days based on severity
    disclosureTimeline: number;  // Days after fix
  };
  
  // Public disclosure
  public: {
    platform: Platform[];        // GitHub, blog, etc.
    format: DisclosureFormat;
    includePoC: boolean;
    creditResearcher: boolean;
  };
  
  // Coordinated disclosure
  coordinated: {
    stakeholders: Stakeholder[];
    notificationOrder: Order[];
    publicRelease: ReleaseStrategy;
  };
}

Compliance and Standards

interface ComplianceRequirements {
  // Industry standards
  standards: {
    iso27001: boolean;
    socII: boolean;
    cis: CISControl[];
    nist: NISTFramework;
  };
  
  // Blockchain specific
  blockchainStandards: {
    scsvs: boolean;     // Smart Contract Security Verification Standard
    defiSafety: number; // Score requirement
    certik: boolean;
    immunefi: boolean;
  };
  
  // Regulatory
  regulatory: {
    jurisdiction: string[];
    requirements: Requirement[];
    reporting: ReportingRequirement[];
  };
}

Rationale

Design Decisions

Risk-Based Approach: Security requirements scale with protocol criticality
Multi-Layer Defense: Combines automated and manual security measures
Continuous Security: Ongoing monitoring rather than point-in-time audits
Transparency: Public disclosure of security practices and findings
Community Involvement: Bug bounties and security researcher engagement

Security Philosophy

Defense in Depth: Multiple security layers
Fail-Safe Defaults: Secure by default configurations
Least Privilege: Minimal access rights
Zero Trust: Verify all interactions
Incident Preparedness: Plan for breaches

Backwards Compatibility

This framework is compatible with:

Existing audit firms' methodologies
Common security tools
Industry standards (OWASP, CWE)
Regulatory requirements

Test Cases

Vulnerability Detection Test

contract VulnerableContract {
  mapping(address => uint256) balances;
  
  // Reentrancy vulnerability
  function withdraw(uint256 amount) external {
    require(balances[msg.sender] >= amount);
    
    // Vulnerable: external call before state update
    (bool success,) = msg.sender.call{value: amount}("");
    require(success);
    
    balances[msg.sender] -= amount;  // Should be before call
  }
}

// Test should detect reentrancy
function testReentrancyDetection() {
  // Run static analysis
  findings = runSlither("VulnerableContract.sol");
  
  // Should find high severity reentrancy
  assert(findings.some(f => 
    f.severity === "HIGH" && 
    f.type === "reentrancy"
  ));
}

Emergency Response Test

async function testEmergencyResponse() {
  // Simulate large unauthorized withdrawal
  const drain = await detectLargeDrain(bridgeContract);
  
  // Should trigger circuit breaker
  expect(drain.triggered).toBe(true);
  expect(await bridgeContract.paused()).toBe(true);
  
  // Should alert war room
  const alerts = await getAlerts();
  expect(alerts).toContain({
    type: 'CRITICAL',
    contract: bridgeContract.address,
    action: 'LARGE_DRAIN'
  });
}

Reference Implementation

Reference security framework at: https://github.com/luxfi/security-framework

Key components:

Automated security scanning
Incident response playbooks
Audit report templates
Security monitoring dashboards

Security Considerations

Framework Security

Regular updates to security standards
Validation of security tools
Auditor vetting process
Secure communication channels

Implementation Risks

Over-reliance on automated tools
Alert fatigue from monitoring
Delayed patching due to process
Disclosure timing challenges

Continuous Improvement

Regular framework reviews
Incorporation of new attack vectors
Tool and methodology updates
Community feedback integration

Security Audit Framework