Euler Finance Integration

Euler Finance offers modular lending vaults where permission management is crucial for protecting capital efficiency and preventing unauthorized withdrawals. This guide details how to implement robust security policies for Euler integrations.

Security Architecture

graph TD
    User[Lending Bot] -->|Deposit/Withdraw| Safe[Smart Account]
    Safe -->|Check Policy| Matador[Matador Interpreter]
    Matador -->|Verify Calldata| Check{Policy Rules}
    Check -- Pass --> Vault[Euler Vault]
    Check -- Fail --> Revert[Revert Transaction]

Permission Patterns

1. Secure Deposits

When automating deposits, the critical invariant is ensuring the shares are minted to the smart account, not an attacker.

policies/euler-deposit.matador

import "abis/EulerVault.json" as Euler;

permission SafeEulerDeposit -> 1.0.0 {
    parameters: {
        vault: address,
        account: address
    }

    fn main() -> bool {
        if (context.target != parameters.vault) {
            return false;
        }

        if (context.selector == Euler.deposit) {
            return Euler.deposit.receiver == parameters.account;
        }

        return false;
    }
}

2. Operational Limits (Capped Exposure)

Prevent a bot from deploying too much capital into a single vault, limiting exposure to protocol risks.

policies/euler-capped.matador

import "abis/EulerVault.json" as Euler;

permission CappedDeposit -> 1.0.0 {
    parameters: {
        vault: address,
        maxDepositAmount: uint256
    }

    fn main() -> bool {
        if (context.target != parameters.vault) {
            return false;
        }

        if (context.selector == Euler.deposit) {
            return Euler.deposit.assets == parameters.maxDepositAmount;
        }

        return false;
    }
}

3. Flash Loan Protection (Self-Originated)

Euler vaults support flash loans. You may want to allow flash loans ONLY if the borrower is your own account (e.g., for liquidation or rebalancing strategies), preventing external actors from using your credit.

policies/euler-flash.matador

import "abis/EulerVault.json" as Euler;

permission SafeFlashLoan -> 1.0.0 {
    parameters: {
        vault: address,
        receiver: address
    }

    fn main() -> bool {
        if (context.target != parameters.vault) {
            return false;
        }

        if (context.selector == Euler.flashLoan) {
            return Euler.flashLoan.receiver == parameters.receiver;
        }

        return false;
    }
}

Integration Tutorial

Setup Project

Install the CLI and download the Euler Vault ABI.

npm install -D matador-policy-cli
mkdir abis
# Download Euler Vault ABI to ./abis/EulerVault.json

Write the Policy

Create policies/euler-guard.matador.

import "abis/EulerVault.json" as Euler;

permission EulerGuard -> 1.0.0 {
    parameters: {
        vault: address,
        account: address
    }

    fn main() -> bool {
        if (context.target != parameters.vault) {
            return false;
        }

        if (context.selector == Euler.deposit) {
            return Euler.deposit.receiver == parameters.account;
        } else if (context.selector == Euler.withdraw) {
            return Euler.withdraw.receiver == parameters.account;
        }

        return false;
    }
}

Compile & Deploy

Compile the policy and provision it to your smart account.

npx matador-policy-cli compile policies/euler-guard.matador

Gas Optimization

Selector First: Always check context.selector == Euler.deposit or context.selector == Euler.withdraw before checking arguments. This fails fast if the function is wrong.
Batching: If you are performing multiple operations (e.g. approve + deposit), consider wrapping them in a MultiCall and using a policy that inspects the MultiCall data (advanced).

Troubleshooting

Issue	Cause	Fix
`PermissionViolation`	`receiver` mismatch.	Ensure your bot sends `receiver` as the smart account address, not `msg.sender` (which might be the bot EOA).
`Invalid Target`	Wrong vault address.	Euler has many vaults (one per asset). Ensure the policy parameter matches the specific vault you are interacting with.

Euler Finance Integration

On this page