Merge pull request #20 from euler-xyz/remove-clearLTV

Remove clearLTV function

src/EVault/EVault.sol

@@ -227,8 +227,6 @@ contract EVault is Dispatch {
 
     function setLTV(address collateral, uint16 borrowLTV, uint16 liquidationLTV, uint32 rampDuration) public virtual override use(MODULE_GOVERNANCE) {}
 
-    function clearLTV(address collateral) public virtual override use(MODULE_GOVERNANCE) {}
-
     function setMaxLiquidationDiscount(uint16 newDiscount) public virtual override use(MODULE_GOVERNANCE) {}
 
     function setLiquidationCoolOffTime(uint16 newCoolOffTime) public virtual override use(MODULE_GOVERNANCE) {}

src/EVault/IEVault.sol

@@ -483,11 +483,6 @@ interface IGovernance {
     /// @param rampDuration Ramp duration in seconds
     function setLTV(address collateral, uint16 borrowLTV, uint16 liquidationLTV, uint32 rampDuration) external;
 
-    /// @notice Completely clears LTV configuratrion, signalling the collateral is not considered safe to liquidate
-    /// anymore
-    /// @param collateral Address of the collateral
-    function clearLTV(address collateral) external;
-
     /// @notice Set a new maximum liquidation discount
     /// @param newDiscount New maximum liquidation discount in 1e4 scale
     /// @dev If the discount is zero (the default), the liquidators will not be incentivized to liquidate unhealthy

src/EVault/modules/Governance.sol

@@ -56,9 +56,9 @@ abstract contract GovernanceModule is IGovernance, BalanceUtils, BorrowUtils, LT
         uint16 liquidationLTV,
         uint16 initialLiquidationLTV,
         uint48 targetTimestamp,
-        uint32 rampDuration,
-        bool initialized
+        uint32 rampDuration
     );
+
     /// @notice Set an interest rate model contract address
     /// @param newInterestRateModel Address of the new IRM
     event GovSetInterestRateModel(address newInterestRateModel);
@@ -261,16 +261,19 @@ abstract contract GovernanceModule is IGovernance, BalanceUtils, BorrowUtils, LT
     }
 
     /// @inheritdoc IGovernance
-    /// @dev When the collateral asset is no longer deemed suitable to sustain debt (and not because of code issues, see
-    /// `clearLTV`), its LTV setting can be set to 0. Setting a zero liquidation LTV also enforces a zero borrowing LTV
-    /// (`newBorrowLTV <= newLiquidationLTV`). In such cases, the collateral becomes immediately ineffective for new
-    /// borrows. However, for liquidation purposes, the LTV can be ramped down over a period of time (`rampDuration`).
-    /// This ramping helps users avoid hard liquidations with maximum discounts and gives them a chance to close their
-    /// positions in an orderly fashion. The choice of `rampDuration` depends on market conditions assessed by the
-    /// governor. They may decide to forgo the ramp entirely by setting the duration to zero, presumably in light of
-    /// extreme market conditions, where ramping would pose a threat to the vault's solvency. In any case, when the
-    /// liquidation LTV reaches its target of 0, this asset will no longer support the debt, but it will still be
-    /// possible to liquidate it at a discount and use the proceeds to repay an unhealthy loan.
+    /// @dev When the collateral asset is no longer deemed suitable to sustain debt, its LTV setting can be set to 0.
+    /// Setting a zero liquidation LTV also enforces a zero borrowing LTV (`newBorrowLTV <= newLiquidationLTV`).
+    /// In such cases, the collateral becomes immediately ineffective for new borrows. However, for liquidation
+    /// purposes, the LTV can be ramped down over a period of time (`rampDuration`). This ramping helps users avoid hard
+    /// liquidations with maximum discounts and gives them a chance to close their positions in an orderly fashion.
+    /// The choice of `rampDuration` depends on market conditions assessed by the governor. They may decide to forgo
+    /// the ramp entirely by setting the duration to zero, presumably in light of extreme market conditions, where
+    /// ramping  would pose a threat to the vault's solvency. In any case, when the liquidation LTV reaches its target
+    /// of 0, this asset will no longer support the debt, but it will still be possible to liquidate it at a discount
+    /// and use the proceeds to repay an unhealthy loan.
+    /// Setting the LTV to zero will not be sufficient if the collateral is found to be unsafe to call liquidation on,
+    /// either due to a bug or a code upgrade that allows its transfer function to make arbitrary external calls.
+    /// In such cases, pausing the vault and conducting an orderly wind-down is recommended.
     function setLTV(address collateral, uint16 borrowLTV, uint16 liquidationLTV, uint32 rampDuration)
         public
         virtual
@@ -295,7 +298,7 @@ abstract contract GovernanceModule is IGovernance, BalanceUtils, BorrowUtils, LT
 
         vaultStorage.ltvLookup[collateral] = newLTV;
 
-        if (!currentLTV.initialized) vaultStorage.ltvList.push(collateral);
+        if (!currentLTV.isRecognizedCollateral()) vaultStorage.ltvList.push(collateral);
 
         if (!newLiquidationLTV.isZero()) {
             // Ensure that this collateral can be priced by the configured oracle
@@ -309,22 +312,10 @@ abstract contract GovernanceModule is IGovernance, BalanceUtils, BorrowUtils, LT
             newLTV.liquidationLTV.toUint16(),
             newLTV.initialLiquidationLTV.toUint16(),
             newLTV.targetTimestamp,
-            newLTV.rampDuration,
-            !currentLTV.initialized
+            newLTV.rampDuration
         );
     }
 
-    /// @inheritdoc IGovernance
-    /// @dev When LTV configuration is cleared, attempt to liquidate the collateral will revert.
-    /// Clearing should only be executed when the collateral is found to be unsafe to liquidate,
-    /// because e.g. it does external calls on transfer, which would be a critical security threat.
-    function clearLTV(address collateral) public virtual nonReentrant governorOnly {
-        uint16 originalLTV = getLTV(collateral, true).toUint16();
-        vaultStorage.ltvLookup[collateral].clear();
-
-        emit GovSetLTV(collateral, 0, 0, originalLTV, 0, 0, false);
-    }
-
     /// @inheritdoc IGovernance
     function setMaxLiquidationDiscount(uint16 newDiscount) public virtual nonReentrant governorOnly {
         // Discount equal 1e4 would cause division by zero error during liquidation

src/EVault/shared/types/LTVConfig.sol

@@ -7,7 +7,7 @@ import {ConfigAmount} from "./Types.sol";
 /// @title LTVConfig
 /// @notice This packed struct is used to store LTV configuration of a collateral
 struct LTVConfig {
-    // Packed slot: 2 + 2 + 2 + 6 + 4 + 1 = 17
+    // Packed slot: 2 + 2 + 2 + 6 + 4 = 16
     // The value of borrow LTV for originating positions
     ConfigAmount borrowLTV;
     // The value of fully converged liquidation LTV
@@ -18,8 +18,6 @@ struct LTVConfig {
     uint48 targetTimestamp;
     // The time it takes for the liquidation LTV to converge from the initial value to the fully converged value
     uint32 rampDuration;
-    // A flag indicating the LTV configuration was initialized for the collateral
-    bool initialized;
 }
 
 /// @title LTVConfigLib
@@ -68,16 +66,6 @@ library LTVConfigLib {
         newLTV.initialLiquidationLTV = self.getLTV(true);
         newLTV.targetTimestamp = uint48(block.timestamp + rampDuration);
         newLTV.rampDuration = rampDuration;
-        newLTV.initialized = true;
-    }
-
-    // When LTV is cleared, the collateral can't be liquidated, as it's deemed unsafe
-    function clear(LTVConfig storage self) internal {
-        self.borrowLTV = ConfigAmount.wrap(0);
-        self.liquidationLTV = ConfigAmount.wrap(0);
-        self.initialLiquidationLTV = ConfigAmount.wrap(0);
-        self.targetTimestamp = 0;
-        self.rampDuration = 0;
     }
 }
 

test/invariants/handlers/modules/GovernanceModuleHandler.t.sol

@@ -44,14 +44,6 @@ contract GovernanceModuleHandler is BaseHandler {
         assert(true);
     }
 
-    function clearLTV(uint256 i) external {
-        address collateral = _getRandomBaseAsset(i);
-
-        eTST.clearLTV(collateral);
-
-        assert(true);
-    }
-
     function setInterestFee(uint16 interestFee) external {
         eTST.setInterestFee(interestFee);
 

test/unit/evault/modules/Governance/governorOnly.t.sol

@@ -30,7 +30,6 @@ contract GovernanceTest_GovernorOnly is EVaultTestBase {
     function test_GovernorAdmin() public {
         eTST.setFeeReceiver(address(0));
         eTST.setLTV(address(0), 0, 0, 0);
-        eTST.clearLTV(address(0));
         eTST.setMaxLiquidationDiscount(0);
         eTST.setLiquidationCoolOffTime(0);
         eTST.setInterestRateModel(address(0));
@@ -46,7 +45,6 @@ contract GovernanceTest_GovernorOnly is EVaultTestBase {
 
         evc.call(address(eTST), address(this), 0, abi.encodeCall(eTST.setFeeReceiver, address(0)));
         evc.call(address(eTST), address(this), 0, abi.encodeCall(eTST.setLTV, (address(0), 0, 0, 0)));
-        evc.call(address(eTST), address(this), 0, abi.encodeCall(eTST.clearLTV, address(0)));
         evc.call(address(eTST), address(this), 0, abi.encodeCall(eTST.setMaxLiquidationDiscount, 0));
         evc.call(address(eTST), address(this), 0, abi.encodeCall(eTST.setLiquidationCoolOffTime, 0));
         evc.call(address(eTST), address(this), 0, abi.encodeCall(eTST.setInterestRateModel, address(0)));
@@ -68,8 +66,6 @@ contract GovernanceTest_GovernorOnly is EVaultTestBase {
         vm.expectRevert(Errors.E_Unauthorized.selector);
         eTST.setLTV(address(0), 0, 0, 0);
         vm.expectRevert(Errors.E_Unauthorized.selector);
-        eTST.clearLTV(address(0));
-        vm.expectRevert(Errors.E_Unauthorized.selector);
         eTST.setMaxLiquidationDiscount(0);
         vm.expectRevert(Errors.E_Unauthorized.selector);
         eTST.setLiquidationCoolOffTime(0);
@@ -96,8 +92,6 @@ contract GovernanceTest_GovernorOnly is EVaultTestBase {
         vm.expectRevert(Errors.E_Unauthorized.selector);
         evc.call(address(eTST), subAccount, 0, abi.encodeCall(eTST.setLTV, (address(0), 0, 0, 0)));
         vm.expectRevert(Errors.E_Unauthorized.selector);
-        evc.call(address(eTST), subAccount, 0, abi.encodeCall(eTST.clearLTV, address(0)));
-        vm.expectRevert(Errors.E_Unauthorized.selector);
         evc.call(address(eTST), subAccount, 0, abi.encodeCall(eTST.setMaxLiquidationDiscount, 0));
         vm.expectRevert(Errors.E_Unauthorized.selector);
         evc.call(address(eTST), subAccount, 0, abi.encodeCall(eTST.setLiquidationCoolOffTime, 0));

test/unit/evault/modules/Vault/ltv.t.sol

@@ -109,36 +109,6 @@ contract VaultTest_LTV is EVaultTestBase {
         eTST.setLTV(address(eTST2), 1e4 + 1, 1e4 + 1, 0);
     }
 
-    function test_clearLtv() public {
-        eTST.setLTV(address(eTST2), 0.5e4, 0.5e4, 0);
-
-        startHoax(borrower);
-        evc.enableCollateral(borrower, address(eTST2));
-        evc.enableController(borrower, address(eTST));
-        vm.stopPrank();
-
-        // No borrow, liquidation is a no-op
-        (uint256 maxRepay, uint256 maxYield) = eTST.checkLiquidation(depositor, borrower, address(eTST2));
-        assertEq(maxRepay, 0);
-        assertEq(maxYield, 0);
-
-        // setting LTV to 0 doesn't change anything yet
-        eTST.setLTV(address(eTST2), 0, 0, 0);
-
-        (maxRepay, maxYield) = eTST.checkLiquidation(depositor, borrower, address(eTST2));
-        assertEq(maxRepay, 0);
-        assertEq(maxYield, 0);
-
-        // collateral without LTV
-        vm.expectRevert(Errors.E_BadCollateral.selector);
-        eTST.checkLiquidation(depositor, borrower, address(eTST));
-
-        // same error after clearing LTV
-        eTST.clearLTV(address(eTST2));
-        vm.expectRevert(Errors.E_BadCollateral.selector);
-        eTST.checkLiquidation(depositor, borrower, address(eTST2));
-    }
-
     function test_ltvList() public {
         assertEq(eTST.LTVList().length, 0);
 

test/unit/evault/shared/Reentrancy.t.sol

@@ -170,9 +170,6 @@ contract MockHookTarget is Test, IHookTarget {
             uint32(bound(amount2, 0, type(uint32).max))
         );
 
-        vm.expectRevert(Errors.E_Reentrancy.selector);
-        eTST.clearLTV(account1);
-
         vm.expectRevert(Errors.E_Reentrancy.selector);
         eTST.setInterestRateModel(account1);
 
@@ -407,9 +404,6 @@ contract ReentrancyTest is EVaultTestBase {
             uint32(bound(amount2, 0, type(uint32).max))
         );
 
-        vm.expectRevert(Errors.E_Reentrancy.selector);
-        eTST.clearLTV(account1);
-
         vm.expectRevert(Errors.E_Reentrancy.selector);
         eTST.setInterestRateModel(account1);