- The investigation is based on almost two months of on-chain forensic investigations, which included the examination of archive-node RPC data, transaction trail analysis, smart contract inspection, and independent validation.
- Both Ethereum and Polygon are the subjects of two real-world case studies that are documented in the present research.
Today, Enso published the findings of its original research, which identified a kind of malevolent liquidity pools that had not been observed before. The company refers to these pools as “toxic pools.” It is possible for these pools to provide traders with correct pricing during simulation, but if transactions are conducted on-chain, they may provide results that are significantly different from what was expected.
Based on the data, it seems that the problem is far more widespread than isolated exploits. Since wallets, aggregators, and other DeFi apps are increasingly relying on transaction simulation to find the optimum execution path, malevolent liquidity may selectively modify those simulations while staying indistinguishable from legitimate pools. This is because the simulations cannot be differentiated from valid pools. Rather than focusing on a specific protocol, the study draws attention to a more widespread execution-quality concern that is harming the infrastructure that users depend on on a daily basis.
The investigation is based on almost two months of on-chain forensic investigations, which included the examination of archive-node RPC data, transaction trail analysis, smart contract inspection, and independent validation. Additionally, contacts at Curve and Oku provided help for the investigation. During the course of the research, the engineering team at Enso discovered two active hazardous pools that were running on separate protocols but employing similar tactics. This finding suggests that the behavior may be duplicated across numerous contexts rather than being isolated instances.
Unlike more conventional kinds of MEV or slippage, poisonous pools are purposefully designed to trick transaction simulations into believing something that is not true. When wallets and aggregators simulate a trade, they provide an enticing execution price. However, after the transaction is mined, they change their behavior, which enables consumers to obtain poorer execution than what was first given while still giving the impression that they are taking the best possible path.
Both Ethereum and Polygon are the subjects of two real-world case studies that are documented in the present research. In one instance, a rigged Curve pool completed more over 129,000 successful swaps despite giving poorer performance than advertised. This resulted to roughly $225,000 in quote overstatement, more than 37,000 reversed transactions, and almost $30,000 in gas spent on unsuccessful swaps. In addition, the quotation was overstated by around $225,000. During another instance, a malicious Uniswap v4 hook was responsible for a transaction failure rate of 99.1%. This hook was responsible for repeatedly luring routing systems before causing transactions to fail.
On the other hand, toxic pools weaken faith in the quotation process itself, in contrast to typical attacks, which target individual smart contracts. It is possible that wallets and aggregators may continue to surface execution pathways that were never capable of providing the price that was first given if the routing infrastructure is unable to differentiate between genuine and falsified bids.
Moreover, the researchers discovered that the Ethereum pool did not consistently engage in harmful behavior. Instead, it exhibited behavior that was both honest and controlled over the course of time, which rendered one-time simulations and manual evaluations inadequate. As a result of the analysis, more oracle contracts that were deployed by the same operator to support additional pools were discovered. This indicates that the attack mechanism may spread beyond the two samples that have been described.
“Our investigation leads us to believe this is not simply another isolated smart contract exploit,” said Milos Costantini, Co-Founder and CPO at Enso. “The industry has spent years optimizing price discovery. Our findings suggest the next challenge is verifying execution integrity. If transaction simulations can be manipulated while real execution tells a different story, we need better ways to verify what users actually receive.”
Enso has enhanced its execution-protection layer, Enso Shield, with dedicated toxic-pool detection and execution verification capabilities. This expansion occurred concurrently with the publication of the study. Enso Shield does not depend exclusively on normal transaction simulations; rather, it continually analyzes real on-chain context, checks quote integrity over time, and validates execution by using transaction traces that are intended to discover inconsistencies that traditional simulation approaches could overlook.
The business thinks that the results pose more general problems about the integrity of execution across wallets, aggregators, DEX aggregators, and other DeFi infrastructure that is dependent on simulated quotations. Enso is supporting more industry study and independent validation into comparable attack patterns throughout the larger transaction stack. This is in contrast to the traditional approach of assigning culpability to specific protocols.
Brendons Karelis, Lead Engineer at Enso, and Milos Costantini, Co-Founder and Chief Product Officer at Enso, have compiled a comprehensive study report that can be seen at the following link: https://hackmd.io/@milonite7/rJne_iQQfe. This paper includes the whole methodology, on-chain proof, transaction traces, and technical analysis.
Therefore, this is the quickest approach to put together and deploy onchain. Simplifying what was formerly a time-consuming and complicated procedure, Enso has earned the trust of more than one hundred projects and has made it possible for more than fifteen billion dollars to be settled on blockchain. The manual integration of protocols, the comprehension of smart contracts, and the investment of considerable resources are no longer required of developers prior to the testing of new products. Enso manages the complexity of onchain interactions by using blockchain shortcuts and a shared execution engine. This enables developers and institutions to concentrate on designing products rather than infrastructure, which is a significant benefit. Visit https://www.enso.build/ for more information.
