Risk Assessment: Metronome Synths

[dudesahn]

Protocol Name

Metronome

Token / Asset to Assess

msUSD, msETH

Chain

Ethereum

Protocol Documentation

https://docs.metronome.io/

Additional Links

No response

Additional Context

Both msUSD and msETH have been solid yield sources for months on Curve and Aerodrome because of consistent bribing from the Metronome team; it's worth evaluating if these pools might be reasonable yield sources in the future or if the risks are too great.

Additionally, their protocol appears to be designed around getting leverage on USD and ETH—could this potentially be a place for building a lender-borrower or some other kind of strategy?

~$30M in Curve pools on mainnet, ~$40M in Aerodrome on Base

[spalen0]

The report still needs full verification; the current score is 2.5 (risk score 3) because of the following issue:

Yes. Both ProxyAdmin contracts on Ethereum are owned by the 3/5 multisig. That means 3 signers can call upgrade() on any proxied contract — Pool, msUSD, msETH, msBTC, debt tokens, SmartFarmingManager, CrossChainDispatcher, Treasury, FeeProvider — all of them. No timelock, no governance vote, no delay.

A malicious upgrade could:

- Add a drain() function to the Treasury and withdraw all collateral
- Modify msUSD/msETH to mint unlimited tokens to an attacker address
- Change the Pool logic to skip liquidation checks
- Brick the protocol entirely

On Base and Optimism it's the same story — the 3/5 Safe is the direct governor with no timelock.