BlockSec Phalcon Details Aztec Vulnerability Tied to RollupProcessorV3 Transaction Binding

BlockSec Phalcon released an updated analysis of an Aztec vulnerability, attributing the root cause to how RollupProcessorV3 handled transaction binding rather than missing access control. According to Foresight News, the issue stemmed from numRealTxs not being effectively bound to the transaction set enforced by the ZK proof. BlockSec said the proof verification path decoded all transactions in encodedInnerTxData and inserted them into the rollup Merkle tree, while the Layer 1 settlement logic processed only the first numRealTxs decoded slots. An attacker exploited this mismatch by placing real deposit transactions in later slots and setting numRealTxs to a smaller value, bypassing checks such as decreasePendingDepositBalance(). The analysis said this allowed the attacker to create unbacked asset balances and withdraw them through the standard withdrawal process. The attacker reportedly created unbacked balances across multiple assets in a single transaction before withdrawing. BlockSec also noted that although Aztec Connect stopped operating on 2024-03-31, the RollupProcessorV3 contract still underwent an upgrade on 4-10 without an external audit.