🔒 Security & Audits
Economic Security

💰 Economic Security

SEAL360's economic model is designed to resist manipulation, attacks, and exploitation through multiple layers of protection.

Core Economic Protections

1. Flash Loan Protection

Threat: Attackers borrowing massive amounts of tokens to manipulate governance or rewards.

Protection:

  • ✅ Flash loan protection mechanisms active
  • ✅ 1.08M S360 per-block trading limit (prevents flash loan attacks)
  • ✅ Flash-borrowed tokens cannot be used for governance votes
  • ✅ Staking rewards immune to flash loan manipulation

Impact: Makes flash loan attacks economically unviable.

2. MEV & Front-Running Protection

Threat: Bots exploiting transaction ordering to extract value from users.

Protections:

  • ✅ Slippage protection on bonding curve trades
  • ✅ Deadline parameters for time-sensitive operations
  • ✅ Commit-reveal scheme for governance votes (planned)
  • ✅ Anti-sandwich attack mechanisms

Example:

// User protects against MEV
bondingCurve.buy{value: 10 ether}(
    minTokens: 9500e18,  // Accept max 5% slippage
    deadline: block.timestamp + 300  // 5 min deadline
);

3. Bonding Curve Integrity

Threat: Price manipulation via large buys/sells.

Protections:

  • ✅ Mathematical price discovery (constant function AMM)
  • ✅ Liquidity depth protection (reserve requirements)
  • ✅ Fee collection (0.3% trading fee) dampens volatility
  • ✅ Emergency circuit breakers

Curve Formula:

Price = k * Supply^2

Where:
- k = 0.0000001 (initial constant)
- Supply = circulating S360 tokens
- Ensures smooth price discovery

Price Impact Analysis:

Buy AmountPrice ImpactCost (AVAX)
1,000 S360~0.01%~0.1
10,000 S360~0.5%~12
100,000 S360~8%~1,500
1,000,000 S360~90%~25,000

Large purchases have exponentially higher costs, preventing manipulation.

4. Staking Attack Prevention

Threat: Attackers gaming staking rewards or manipulating governance weight.

Protections:

  • ✅ Minimum stake period (no instant stake-vote-unstake)
  • ✅ Withdrawal delays (prevents flash staking)
  • ✅ Reward calculation immune to manipulation
  • ✅ Emergency withdrawal available (without rewards)

Staking Economics:

  • APY: 12-25% (based on total staked)
  • Min Stake: 100 S360
  • Cooldown: 7 days
  • Early Exit: Available, forfeit rewards

5. Governance Security

Threat: Wealthy actors buying governance control.

Protections:

  • ✅ Proposal creation requires 100,000 S360 staked (masternode requirement)
  • ✅ 4% quorum requirement (51.85M S360 must vote - 4% of 1.296B total)
  • ✅ 2-day timelock minimum on all executions
  • ✅ Multi-signature veto power for emergencies (4/7 signatures ≥57% approval)

Cost of Attack: To control governance, an attacker would need:

  1. Acquire >50% of supply: ~648M S360 tokens (>$64.8M at $0.1 initial price)
  2. Stake for extended period: Tokens must be staked, locking capital and exposing to price risk
  3. Survive community scrutiny: All proposals are public and reviewed by community
  4. Bypass timelock: 2 days minimum delay for community response and organization
  5. Defeat multi-sig: Emergency council (4/7 signatures ≥57% approval) can veto malicious proposals

Conclusion: Economic attack on governance is prohibitively expensive (>$64.8M minimum) and has multiple layers of defense that make success extremely unlikely.

6. Treasury Protection

Threat: Draining the treasury via malicious proposals or exploits.

Protections:

  • ✅ Multi-signature control (4/7 signatures required ≥57% approval for emergency actions)
  • ✅ Spending limits enforced on-chain
  • ✅ Timelock on all withdrawals (2 days minimum)
  • ✅ Governance approval required for large expenditures
  • ✅ Emergency freeze capability

Treasury Allocation:

  • Treasury Reserve: 108M S360 (8.3% of total supply)
  • Initial Value: ~$10.8M USD equivalent at $0.1 price
  • Governance Required: Yes, for all spending decisions
  • Timelock: 2 days minimum on all withdrawals
  • Purpose: Protocol development, audits, liquidity, partnerships

7. Token Supply Integrity

Threat: Unauthorized minting or burning affecting tokenomics.

Protections:

  • ✅ Hard cap: 1,296,360,012 S360 (immutable, fractal design)
  • ✅ Minting disabled after initial distribution
  • ✅ No admin mint function (eliminated in v3.2.0)
  • ✅ No burning mechanism (fixed supply forever)

Supply Distribution (14 wallets):

  • Total Supply: 1,296,360,012 S360 (1.296 Billion)
  • Admin Operations: 36.36M (2.8%)
  • Founder: 108M (8.3%, 4yr vesting + 1yr cliff)
  • Core Team: 108M (8.3%)
  • Ecosystem Fund: 216M (16.7%)
  • Treasury Reserve: 108M (8.3%)
  • Marketing: 108M (8.3%)
  • Liquidity (DEX): 108M (8.3%)
  • Staking Rewards: 108M (8.3%, 365-day lock)
  • Bonding Curve: 108M (8.3%, gradual release)
  • DAO Governance: 108M (8.3%)
  • Community: 108M (8.3%)
  • Strategic Alliances: 24M (1.9%)
  • R&D Innovation Labs: 24M (1.9%, 5-year lock)

Economic Attack Scenarios (All Mitigated)

❌ Scenario 1: Flash Loan Governance Attack

Attack: Borrow large amount of S360, vote on malicious proposal, return tokens.

Defense:

  1. Per-block trading limit (1.08M S360) prevents massive acquisitions
  2. Staking requirement means borrowed tokens can't be used for voting
  3. Governance requires 100K S360 staked to create proposals
  4. Timelock gives 2 days minimum to respond and organize counter-votes
  5. Emergency multisig (4/7 signatures ≥57% approval) can veto malicious proposals

Result: ❌ Attack fails. Attacker cannot acquire enough tokens in time, and even if possible, community + multisig provides defense.

❌ Scenario 2: Bonding Curve Drain

Attack: Manipulate price to drain liquidity pool.

Defense:

  1. Mathematical pricing prevents manipulation
  2. Large trades have exponential price impact
  3. 30% reserve requirement maintains liquidity
  4. Slippage protection stops unfavorable trades

Result: ❌ Attack economically unviable due to slippage.

❌ Scenario 3: Reward Pool Exploitation

Attack: Stake massive amounts briefly to steal rewards.

Defense:

  1. Rewards calculated per-second fairly
  2. Minimum stake period prevents gaming
  3. Flash staking doesn't accumulate rewards
  4. Emergency withdrawal available without rewards

Result: ❌ No exploit possible, math is sound.

❌ Scenario 4: MEV Sandwich Attack

Attack: Front-run + back-run user's bonding curve trade.

Defense:

  1. User sets minimum output (slippage protection)
  2. Transaction deadline prevents stale execution
  3. Price impact limits make sandwich unprofitable

Result: ❌ MEV bot loses gas fees, user protected.

Economic Invariants

These properties ALWAYS hold (enforced by smart contracts):

  1. Supply Cap: totalSupply() == 1,296,360,012e18 ✅ (immutable, no mint/burn)
  2. Bonding Curve Allocation: bondingCurveSupply == 108,000,000e18 ✅
  3. Staking Rewards: pendingRewards <= rewardPool.balance ✅
  4. Fee Distribution: Trading fee = 0.3% on bonding curve ✅
  5. Governance Quorum: votesFor + votesAgainst >= 51,854,400e18 ✅ (4% of total supply)

Economic Monitoring

Post-deployment, we monitor:

  • 📊 Bonding curve liquidity depth
  • 📈 Price volatility & manipulation attempts
  • 🎯 Staking reward sustainability
  • 🗳️ Governance participation rates
  • 💰 Treasury balance & spending
  • ⚠️ Anomalous transaction patterns

Alert Thresholds:

  • Liquidity drop >20% in 1 hour → Alert
  • Price movement >50% in 1 day → Investigation
  • Large unstake (>1M S360) → Monitor
  • Governance proposal with low quorum → Extend voting

Economic Security Roadmap

✅ Completed:

  • Flash loan protection
  • MEV mitigation
  • Bonding curve integrity
  • Governance security
  • Treasury safeguards

🔄 In Progress:

  • Real-time economic monitoring dashboard
  • Automated alert system
  • Game theory modeling

📅 Planned:

  • Insurance fund for edge cases (Q2 2026)
  • Cross-chain economic security (Q3 2026)
  • Formal economic model audit (Q2 2026)

Resources

For technical implementation details:

For security audits:

Fixes v3.3.1Known Vulnerabilities