kiss first, then heal

eight of makerdao debt auctions were blocked by someone unknowingly (or maliciously) using the auction proceeds to cancel out system debt instead of on-auction debt.

in makerdao liquidations go to the debt queue where debt matures over 6.5 days. it's usually redeemed earlier via collateral auctions or system surplus. if it doesn't happen, debt (flop) auctions occur. to start a flop auction you need to bring system surplus to zero first by canceling it out with system debt (sin) using heal function.

then you can start an auction that turns sin into ash, on-auction debt. after the first bid, you can use the proceeds to cancel out sin. this is done using kiss function which also removes the appropriate amount of on-auction debt. someone has used heal instead which doesn't remove ash blocking further auctions.

of course, it can be fixed rather easily, but the problem of blocking still stands, it will probably require an upgrade to the flopper contract so it can kiss immediately after receiving the first bid.

here is a helpful presentation which explains what happened in much greater detail. don't forget to read the speaker notes.

https://docs.google.com/presentation/d/1nnpPBiOLEWi81q8zrHoIWH4s3iQaKrCSaR68AafzQJo/edit#slide=id.p

crypto eli5

kiss first, then heal

eight of makerdao debt auctions were blocked by someone unknowingly (or maliciously) using the auction proceeds to cancel out system debt instead of on-auction debt.

in makerdao liquidations go to the debt queue where debt matures over 6.5 days. it's usually redeemed earlier via collateral auctions or system surplus. if it doesn't happen, debt (flop) auctions occur. to start a flop auction you need to bring system surplus to zero first by canceling it out with system debt (sin) using heal function.

then you can start an auction that turns sin into ash, on-auction debt. after the first bid, you can use the proceeds to cancel out sin. this is done using kiss function which also removes the appropriate amount of on-auction debt. someone has used heal instead which doesn't remove ash blocking further auctions.

of course, it can be fixed rather easily, but the problem of blocking still stands, it will probably require an upgrade to the flopper contract so it can kiss immediately after receiving the first bid.

here is a helpful presentation which explains what happened in much greater detail. don't forget to read the speaker notes.

https://docs.google.com/presentation/d/1nnpPBiOLEWi81q8zrHoIWH4s3iQaKrCSaR68AafzQJo/edit#slide=id.p

hottg.com/crypto_eli5/824

2.0K viewsedited  Mar 22, 2020 at 07:00