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WETHROUTER.md

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WETHRouter

Overview

The WETHRouter contract is designed to facilitate a straightforward interaction with the Moonwell protocol for end users that hold ETH in their wallet. It wraps raw Ethereum (ETH) into Wrapped Ethereum (WETH) before depositing into Moonwell, allowing for a single transaction to both add and remove ETH liquidity.

This contract interacts with several other contracts:

  • SafeERC20: a library provided by OpenZeppelin that provides safe versions of the ERC20 operations that throw on failure.
  • IERC20: the standard interface for Ethereum tokens.
  • WETH9: the standard implementation of WETH, wrapped Ether.
  • MErc20: a custom ERC20 contract used in the Moonwell protocol.

Contract Architecture

State Variables

  • weth: This public, immutable state variable holds the address of the WETH9 contract.
  • mToken: This public, immutable state variable holds the address of the MErc20 contract.

Constructor

  • The constructor is called when the contract is deployed. It takes two parameters - the addresses of the WETH9 and MErc20 contracts. It sets these addresses to the state variables and approves the mToken contract to spend the maximum amount of WETH.

Functions

mint()

  • This function is used to deposit raw ETH into the Moonwell protocol.
  • It takes a recipient parameter - the address to receive the mToken.
  • It's marked as payable so it can receive Ether.
  • First, the function deposits all sent ETH into the WETH contract.
  • Then it mints mTokens of equivalent value, minus some rounding error in the Compound math.
  • If the MToken minting operation fails, it throws an error with the message "WETHRouter: mint failed".
  • After minting, it transfers the mToken balance of the WETHRouter to the recipient using the safeTransfer method from the SafeERC20 library to check the ERC20 transfer happened successfully.

redeem()

  • This function is used to redeem an mToken for raw ETH.
  • It takes two parameters: mTokenRedeemAmount and recipient. The first one represents the amount of mToken to redeem, and the second one is the address to receive the ETH.
  • First, it transfers the specified amount of mToken from the sender to the WETHRouter using the safeTransferFrom method from the SafeERC20 library to check that the transfer from the sender to this contract succeeded.
  • Then it redeems the mToken for WETH. If the redeem operation fails, it throws an error with the message "WETHRouter: redeem failed".
  • After redeeming, it withdraws the WETH to ETH and attempts to transfer the total balance of the contract to the recipient.
  • If the ETH transfer fails, it throws an error with the message "WETHRouter: ETH transfer failed".

receive()

  • This function is used to receive Ether. It's marked as external payable but doesn't perform any operations.

Edge Cases & Considerations

  • If the minting or redeeming of mTokens fails for any reason, the function will throw an error and revert the transaction. This is expected behavior as Compound mint and redeem functions can both fail silently, leaving tokens stuck in the contract if the call didn't fail.
  • If the transfer of ETH in the redeem function fails, for example due to the call stack being too deep or the recipient contract throwing an error, the function will throw an error and revert the transaction.
  • The contract's balance of WETH is always fully approved for the mToken contract to spend. If the mToken contract is compromised, all WETH held by the contract could be stolen. However, both of these conditions being true is unlikely given the WETHRouter is non custodial, meaning it should never hold user funds once the transaction ends.