Smart Contract Audit – ultimate guide, tools and pricing

Smart contract audit – why is it so important? How to do it and what is the price? 

The blockchain industry has always been a honeypot for hackers of all sorts. In most cases, attacks succeed because of the critical bugs in the underlying smart contracts. You may wonder how they discover these smart contract vulnerabilities in the first place.

Well, the transparent nature of blockchain makes this task much simpler. One can verify any transaction on a public ledger and thus omit the need for trust between two parties. Yet, one can also see all the weak spots of smart contracts and exploit them to steal funds from a project.

How can blockchain companies protect against such cyberattacks? Smart contract security audit stands forward to help them prevent such disasters.

What is a smart contract audit? 

A smart contract security audit focuses on the correctness of the contract code. It’s important for a third party to perform a detailed analysis. The developers mustn’t do smart contract auditing themselves. Why not? Well, they may be prejudiced against their brainchild and miss its loopholes. A fresh look from the outside may help to reveal errors in the code. More than that, it can help save blockchain startups huge sums of money.

Typically, the security audit process consists of the following steps:

• Developers provide their code to a third-party audit for analysis.
• The team of expert auditors scrutinizes the code. The detailed review and tests reveal the errors that the smart contract auditors present in a form of a report. The analysis usually consists of two parts:

1. 1. Automated code verification. It helps to reveal potential bugs with the help of automated tools such as fuzzers or symbolic execution machines. 
   2. Manual auditing & verification. It implies testing the code with manually designed attack vectors and exploits by experienced developers.

• After the analysis, the smart contract auditors also come up with suggestions on how to fix these errors.
• The project team edits the code under the auditors’ report.
• The audit team makes one more analysis to ensure that the code doesn’t contain any more errors.

As you may see, an external security audit is essential to the security of smart contracts. Besides, the blockchain industry evolves and attracts more investors. The bigger the money flow, the higher the hackers’ scrutiny. Therefore, the more important it is to protect against their attacks.

Thus, the Chainalysis report reveals that in Q1 2022 alone, hackers have drained crypto projects by $1.3 billion. Half of this amount has been stolen due to code exploits. It is pretty natural that investors are concerned about the security of their funds. Thus, performing the automated smart contract audit is nothing but a prudent act.

Chainalysis: DeFi protocols have proved to be especially prone to various attacks in 2022

Why are smart contract audits so important? 

Ethereum smart contracts usually rely on the programming language Solidity. Any error inside of the code may turn into a critical vulnerability and severe money losses. Want to know the exact numbers? Well, you don’t have to go too far to find them.

Take Wormhole, an escrow system serving as a bridge between different blockchains. The service became a victim of an attack not so long ago, in February 2022. Hackers have managed to steal an astonishing sum of 120,000 wETH or $326 million. The theft was possible thanks to a vulnerability in signature verification.

Another notorious incident happened to Poly Network in August 2021. A hacker managed to drain the project by $600 million. “Mr. White Hat”, as he calls himself, exploited a vulnerability in smart contract calls. The project published a series of tweets explaining what happened and how. Luckily for the project, the full sum was returned soon after the theft. At the same time, Poly Network offered the hacker a top job in the company. Yet, not everyone can get away so easily.

Believe it or not, hackers may not always be the main villains of the story in the crypto world. A single bug in the code may result in money losses without any external intrusion. This is what happened to an algorithmic money market protocol Compound Finance in September 2021. A bug in the code made the platform issue more tokens than it should have. After that, it distributed them across the network participants. All-in-all, $90 million worth of COMP cryptocurrency left the Comptroller Contract. Leshner, the founder and CEO of the project, appealed to users in a tweet asking them to refund funds. But who on Earth would do that being in sound mind and good health?

Tokenguard – the best tool to do your smart contract audit 

A thorough smart contract audit could have reduced the chances of such attacks. More than that, it could have saved these projects lots of money. While there are many tools and smart contract audit services available in the market, it is vital to find the one that would really work.

If you have some technical knowledge, you may try some of the free solutions available on the web. It would be prudent to do so even before applying to third-party auditing services. For example, you may look through SWC-registry. This is an online library of smart contract vulnerabilities and weaknesses. Echidna, another open-source fuzzer available on GitHub, can also be useful. Also, there is Manticore, a symbolic execution tool for the analysis of smart contracts and binaries. It can also be found on GitHub. Yet, if you don’t have relevant skills and knowledge, you’d better outsource this task.

Tokenguard represents a dashboard for managing security. It can help you track the operations of any digital currency and smart contracts. Its services and features can be useful for blockchain companies as well as for their investors. Here are some benefits that it offers to its users:

• Simplicity

Whether you are a business owner or an investor with no coding experience, the platform is quite easy to use. All you need to do is to paste the address of the Ethereum token and see if it is secure. Tokenguard will conduct the whole process on your behalf. Moreover, it will provide you with a report that even non-tech folks can easily understand.

• Easy token scoring

Tokenguard provides each ICO with a rate from 0 to 10. This rate helps to evaluate the security of its code in a simple manner.

• Speed

The blockchain industry is moving extremely fast. Sometimes you don’t have enough time to think through your investment decisions. Worries aside, though. With Tokenguard, it takes only 3 hours to make a report.

• Automated updates 24/7

As the code updates, new vulnerabilities may arise. There’s no need to worry, though. Tokenguard automatically updates the auditing reports. Thus, if any security issues arise, you will be the first one to know thanks to automatic alerts.

What do you need to know before doing a smart contract audit? 

Do I need to know some programming languages before doing a smart contract audit?  The answer is simple: no, you don’t. Sure, it wouldn’t hurt if you can analyze the code yourself. It would anyway be useful to check, but it still won’t provide you with an unbiased picture.

The best thing about outsourcing such tasks is that third-party tools like Tokenguard offer ease of use. Here are some tips on what the smart contract auditing process looks like:

1. Find the token in the database. In case you can’t find it, you can simply copy-paste its address.
2. Make a coffee and wait. It takes only 3 hours for the service to complete the audit.
3. Check the report. Tokenguard provides you with a human-readable report. In the document, you will easily see all the weak spots of the token.
4. Make a decision. The easy scoring system makes it pretty easy to assess the security of the project. Then it would be up to you to decide if it’s worth investing any funds.

As you see, the smart contract auditing process is pretty simple and doesn’t require any technical skills. Most importantly, experts from Tokenguard make an unbiased review as they have no financial motivation to misguide you.

Smart contract audit – what is the price? 

The cost of a smart contract audit depends on a number of factors. Tokenguard offers three plans for investors of different levels. The most popular Basic Plan costs only $249 per month. It would fit standalone investors who only begin investigating various opportunities in the blockchain industry. It includes:

• Access to top 20 popular ratings
• Security monitoring of specific smart contracts
• Specialists’ consultancy within 24 hrs

The Professional Plan with a market price of $2,499 per month is tailored to professional investors. It comes with a number of extra features such as:

• 10 chosen smart contracts audits
• Access to all detailed ratings on the platform
• Security monitoring of existing tokens
• Specialists’ consultancy within 3 hrs

Finally, the Enterprise plan would fit businesses that need to ensure the security of their investors’ funds. Here’s what developers may expect to get:

• Preview of the exact line with an error
• Manual auditing for an extra fee
• Priority of generating ratings in case of high traffic
• Security monitor of new vulnerabilities for existing ratings

The price for the Enterprise plan is negotiable. Get in touch to get an exact offer

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