How to Audit a Smart Contract in the Most Efficient Way

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Guide to Secure your Smart Contract effectively and efficiently.

Photo by Federico Beccari on Unsplash

When it comes to the attacks on Web3, we are witnessing a continuous increase in the number of attacks from the last few years, In 2022 Web3 faced the most number of attacks, and 2023 is expected to be no different. We can witness an even higher number of attacks this year.

While malicious users are discovering new innovations to breach into some of the most secure systems, what are we doing to protect our users from any misfortune? Well, the one thing we can do is educate our users, and the other most important thing is to go for a Smart Contract Audit. If you are new to this term, let me quickly introduce you to smart contract auditing.

What is Smart Contract Auditing?

When developers work day and night to create a protocol whose sole foundation is in its smart contract logic, they receive much applause. Still, when there is a security breach due to a flaw in the smart contract, they are the ones who take the blame most of the time. Though developers stay vigilant and cautious while creating smart contracts, sometimes vulnerabilities are missed.

Smart contract auditing is the process of reviewing and evaluating the code and design of smart contracts which developers create to ensure that they are secure, reliable and free from vulnerabilities. Smart contract audits help you find any flaws that can be due to any reason, not limited to just the code but logic and designs. This is why it is so important to go for an audit if you want to have a good relationship with your user and a good business.

Auditing Efficiently

When it comes to smart contract auditing, it is important where we focus our attention. You never know in what section you will find the vulnerability that may cost millions, and you never know in which contract the flaw lies; thus, it is very crucial that the protocol contracts are properly and systematically examined.

But this covering of the whole project can be a bit time-consuming and tedious, but it is as necessary. There are some checks and some tips that will help you cover the whole contract better rather than just shooting the shots in the dark. Let’s go through them one by one.

1.Understand business logic

It is of utmost importance to understand the logic of smart contracts. This involves understanding the requirements, specifications, and design of the contracts. Understand the intended functionality of a contract and how it relates to the business. This will help identify discrepancies between the intended functionality and implementation.

2.Use Automated tools

You sure would have heard of chatGPT, one of the most talked about things on the internet nowadays. It has immense capabilities and can be useful in finding some common bugs and logic errors. Automated tools help by detecting common vulnerabilities and saving time for the auditors. However, when any AI tool suggests any changes, it should be properly checked and verified because sometimes there can be a difference between what the AI suggests and what should be. If you want to know more about this part, read this.

3.Test the Contract on Testnet

Testnets like Ropsten, Rinky, or Kovan help immensely when testing the smart contract with various inputs. It is crucial to ensure that the contracts behave as they are expected. Sometimes testing with different inputs can help find some of the bugs. Testing contracts on testnets can help you check if things are going in the right direction during development.

4.Use a formal verification tool.

Formal verification tools can prove mathematically that the smart contract behaves as intended and contains no errors. These tools are often time-consuming but important in ensuring the complete security of smart contracts; they provide a high degree of confidence in the correctness of code. To learn more about this complex topic, read here.

5.Perform a manual code review.

Using AI tools, formal verification, and testnets all have their benefits, but doing a manual code review is of the utmost importance. To perform a high-level audit, the auditors must go through the code line-by-line, checking for logical errors, security vulnerabilities and other important issues. This section gives special attention to the critical contract’s functionalities, such as payment processing, access control, etc. Manual code review also involves checking if the code adheres to the best practices and industry standards.

Conclusion

Auditing a smart contract is crucial if you want your protocol, your business and your users to be safe from the threats of the Web3 world. Audits do not only help you secure your business but also help you improve user relationships through audit reports. As the threats are increasing and users are becoming aware of the threats Web3 now faces, users only invest in the protocols that provide them security. The audit reports are how users nowadays assess the security of the protocol.

 

 

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