Cryptoasset Anti-Financial Crime Specialist (CCAS) Certification Practice Test

When does using a 'send' function in a smart contract pose a vulnerability?

1. If the external address is a stable coin

2. If the external address is a smart contract

3. If the destination contract has an active fallback function

4. If the transaction fails to revert properly

The correct answer is: If the external address is a smart contract

Using a 'send' function in a smart contract can pose a vulnerability primarily when the external address is a smart contract. This is because smart contracts can have complex behaviors, like executing fallback functions during the process of receiving Ether or tokens. When a smart contract receives a 'send' function call, it may trigger its fallback function, which could lead to unintended consequences. For example, if the called smart contract's fallback function performs some operations, it might call the original sender contract again, leading to potential reentrancy attacks. This is a common vulnerability where an attacker can exploit the control flow of a smart contract to manipulate its execution state, often resulting in a drain of funds or locking up assets unintentionally. While the other scenarios may involve certain risks, they do not typically carry the same level of vulnerability associated with the interaction of smart contracts and their ability to alter execution paths during Ether transfers.