Price Impact Remediation

Overview

Related Detector: Price Impact

Large swaps without price impact validation enable sandwich attacks. The fix is to compare pool prices before and after swaps, enforce a maximum price impact threshold, and combine with slippage protection.

Recommended Fix

Before (Vulnerable)

let output = execute_swap(pool, amount)?;
transfer(output)?;

After (Fixed)

let price_before = get_pool_price(pool)?;
let output = execute_swap(pool, amount)?;
let price_after = get_pool_price(pool)?;

let impact = price_before.abs_diff(price_after) * 10000 / price_before;
require!(impact <= max_impact_bps as u64, ErrorCode::ExcessivePriceImpact);
require!(output >= min_output, ErrorCode::SlippageExceeded);
transfer(output)?;

Alternative Mitigations

Split Large Orders

Break large swaps into smaller chunks executed across multiple transactions to reduce per-trade price impact.

Use TWAP

For time-insensitive operations, use a time-weighted average price mechanism that executes portions of the swap over multiple slots.

Common Mistakes

Mistake: Checking Impact but Not Slippage

// WRONG: checks price impact but not minimum output
require!(impact <= max_impact, ExcessiveImpact);
// Output could still be lower than expected due to other factors

Always combine price impact checks with minimum output validation.