test/feat: incentive accumulator truncation (#7395) (#7396)

* test/feat: incentive accumulator truncation

* updates

(cherry picked from commit 8eaaae9)

Co-authored-by: Roman <[email protected]>

x/concentrated-liquidity/export_test.go

@@ -232,7 +232,7 @@ func (k Keeper) CreateUptimeAccumulators(ctx sdk.Context, poolId uint64) error {
 }
 
 func CalcAccruedIncentivesForAccum(ctx sdk.Context, accumUptime time.Duration, qualifyingLiquidity osmomath.Dec, timeElapsed osmomath.Dec, poolIncentiveRecords []types.IncentiveRecord) (sdk.DecCoins, []types.IncentiveRecord, error) {
-	return calcAccruedIncentivesForAccum(ctx, accumUptime, qualifyingLiquidity, timeElapsed, poolIncentiveRecords)
+	return calcAccruedIncentivesForAccum(ctx, accumUptime, qualifyingLiquidity, timeElapsed, poolIncentiveRecords, 0)
 }
 
 func (k Keeper) UpdateGivenPoolUptimeAccumulatorsToNow(ctx sdk.Context, pool types.ConcentratedPoolExtension, uptimeAccums []*accum.AccumulatorObject) error {

x/concentrated-liquidity/incentives.go

@@ -7,6 +7,7 @@ import (
 	"time"
 
 	sdkprefix "github.com/cosmos/cosmos-sdk/store/prefix"
+	"github.com/cosmos/cosmos-sdk/telemetry"
 	sdk "github.com/cosmos/cosmos-sdk/types"
 	"github.com/cosmos/cosmos-sdk/types/query"
 	"golang.org/x/exp/slices"
@@ -189,7 +190,7 @@ func (k Keeper) updateGivenPoolUptimeAccumulatorsToNow(ctx sdk.Context, pool typ
 		for uptimeIndex := range uptimeAccums {
 			// Get relevant uptime-level values
 			curUptimeDuration := types.SupportedUptimes[uptimeIndex]
-			incentivesToAddToCurAccum, updatedPoolRecords, err := calcAccruedIncentivesForAccum(ctx, curUptimeDuration, qualifyingLiquidity, timeElapsedSec, poolIncentiveRecords)
+			incentivesToAddToCurAccum, updatedPoolRecords, err := calcAccruedIncentivesForAccum(ctx, curUptimeDuration, qualifyingLiquidity, timeElapsedSec, poolIncentiveRecords, poolId)
 			if err != nil {
 				return err
 			}
@@ -222,7 +223,7 @@ func (k Keeper) updateGivenPoolUptimeAccumulatorsToNow(ctx sdk.Context, pool typ
 // Returns the IncentivesPerLiquidity value and an updated list of IncentiveRecords that
 // reflect emitted incentives
 // Returns error if the qualifying liquidity/time elapsed are zero.
-func calcAccruedIncentivesForAccum(ctx sdk.Context, accumUptime time.Duration, liquidityInAccum osmomath.Dec, timeElapsed osmomath.Dec, poolIncentiveRecords []types.IncentiveRecord) (sdk.DecCoins, []types.IncentiveRecord, error) {
+func calcAccruedIncentivesForAccum(ctx sdk.Context, accumUptime time.Duration, liquidityInAccum osmomath.Dec, timeElapsed osmomath.Dec, poolIncentiveRecords []types.IncentiveRecord, poolID uint64) (sdk.DecCoins, []types.IncentiveRecord, error) {
 	if !liquidityInAccum.IsPositive() || !timeElapsed.IsPositive() {
 		return sdk.DecCoins{}, []types.IncentiveRecord{}, types.QualifyingLiquidityOrTimeElapsedNotPositiveError{QualifyingLiquidity: liquidityInAccum, TimeElapsed: timeElapsed}
 	}
@@ -244,6 +245,21 @@ func calcAccruedIncentivesForAccum(ctx sdk.Context, accumUptime time.Duration, l
 		// Incentives to emit per unit of qualifying liquidity = total emitted / liquidityInAccum
 		// Note that we truncate to ensure we do not overdistribute incentives
 		incentivesPerLiquidity := totalEmittedAmount.QuoTruncate(liquidityInAccum)
+
+		// If truncation occurs, we emit events to alert us of the issue.
+		if incentivesPerLiquidity.IsZero() && !totalEmittedAmount.IsZero() {
+			ctx.EventManager().EmitEvent(sdk.NewEvent(
+				types.IncentiveTruncationPlaceholderName,
+				sdk.NewAttribute("pool_id", strconv.FormatUint(poolID, 10)),
+				sdk.NewAttribute("total_liq", liquidityInAccum.String()),
+				sdk.NewAttribute("per_unit_liq", incentivesPerLiquidity.String()),
+				sdk.NewAttribute("total_amt", totalEmittedAmount.String()),
+			))
+
+			telemetry.IncrCounter(1, types.IncentiveTruncationPlaceholderName)
+			ctx.Logger().Error(types.IncentiveTruncationPlaceholderName, "pool_id", poolID, "total_liq", liquidityInAccum, "per_unit_liq", incentivesPerLiquidity, "total_amt", totalEmittedAmount)
+		}
+
 		emittedIncentivesPerLiquidity := sdk.NewDecCoinFromDec(incentiveRecordBody.RemainingCoin.Denom, incentivesPerLiquidity)
 
 		// Ensure that we only emit if there are enough incentives remaining to be emitted

x/concentrated-liquidity/incentives_test.go

@@ -2,6 +2,7 @@ package concentrated_liquidity_test
 
 import (
 	"errors"
+	"fmt"
 	"time"
 
 	sdk "github.com/cosmos/cosmos-sdk/types"
@@ -11,6 +12,7 @@ import (
 	"github.com/osmosis-labs/osmosis/osmomath"
 	"github.com/osmosis-labs/osmosis/osmoutils/accum"
 	cl "github.com/osmosis-labs/osmosis/v22/x/concentrated-liquidity"
+	"github.com/osmosis-labs/osmosis/v22/x/concentrated-liquidity/math"
 	"github.com/osmosis-labs/osmosis/v22/x/concentrated-liquidity/model"
 	"github.com/osmosis-labs/osmosis/v22/x/concentrated-liquidity/types"
 	"github.com/osmosis-labs/osmosis/v22/x/gamm/pool-models/balancer"
@@ -3548,3 +3550,90 @@ func (s *KeeperTestSuite) TestGetIncentiveRecordSerialized() {
 		})
 	}
 }
+
+// This PR shows that there is a chance of incentives being truncated due to large liquidity value.
+// We observed this in pool 1423 where both tokens have 18 decimal precision.
+//
+// It has been determined that no funds are at risk. The incentives are eventually distributed if either:
+// a) Long time without an update to the pool state occurs (at least 51 minute with the current configuration)
+// b) current tick liquidity becomes smaller
+func (s *KeeperTestSuite) TestIncentiveTruncation() {
+	s.SetupTest()
+
+	// Create a pool
+	pool := s.PrepareConcentratedPool()
+
+	// 	osmosisd q concentratedliquidity incentive-records 1423 --node https://osmosis-rpc.polkachu.com:443
+	// incentive_records:
+	// - incentive_id: "5833"
+	//   incentive_record_body:
+	//     emission_rate: "9645.061724537037037037"
+	//     remaining_coin:
+	//       amount: "518549443.513510006462246574"
+	//       denom: ibc/A8CA5EE328FA10C9519DF6057DA1F69682D28F7D0F5CCC7ECB72E3DCA2D157A4
+	//     start_time: "2024-01-31T17:16:11.187417702Z"
+	//   min_uptime: 0.000000001s
+	//   pool_id: "1423"
+	// pagination:
+	//   next_key: null
+	//   total: "0"
+	// 24 * 60 * 60 * 9645.061724537037037037
+	// 833333333.0        -<------ Initial incentives in recorrd
+	incentiveCoin := sdk.NewCoin("ibc/A8CA5EE328FA10C9519DF6057DA1F69682D28F7D0F5CCC7ECB72E3DCA2D157A4", sdk.NewInt(833333333))
+
+	// Create a pool state simulating pool 1423. The only difference is that we force the pool state given 1 position as
+	// opposed to many.
+	// osmosisd q poolmanager pool 1423 --height 13559864 --node https://osmosis-rpc.polkachu.com:443
+	desiredLiquidity := osmomath.MustNewBigDecFromStr("28968940108516957474488782.253893404842148631")
+	desiredCurrentTick := int64(596)
+	desiredCurrentSqrtPrice, err := math.TickToSqrtPrice(desiredCurrentTick)
+	s.Require().NoError(err)
+
+	amount0 := math.CalcAmount0Delta(desiredLiquidity, desiredCurrentSqrtPrice, types.MaxSqrtPriceBigDec, true).Dec().TruncateInt()
+	amount1 := math.CalcAmount1Delta(desiredLiquidity, types.MinSqrtPriceBigDec, desiredCurrentSqrtPrice, true).Dec().TruncateInt()
+
+	lpCoins := sdk.NewCoins(sdk.NewCoin(ETH, amount0), sdk.NewCoin(USDC, amount1))
+	s.FundAcc(s.TestAccs[0], lpCoins)
+
+	// LP
+	positionData, err := s.App.ConcentratedLiquidityKeeper.CreatePosition(s.Ctx, pool.GetId(), s.TestAccs[0], lpCoins, osmomath.ZeroInt(), osmomath.ZeroInt(), types.MinInitializedTick, types.MaxTick)
+	s.Require().NoError(err)
+
+	fmt.Println("initial liquidity", positionData.Liquidity)
+
+	// Fund the account with the incentive coin
+	s.FundAcc(s.TestAccs[0], sdk.NewCoins(incentiveCoin))
+
+	// Set incentives for pool to ensure accumulators work correctly
+	_, err = s.App.ConcentratedLiquidityKeeper.CreateIncentive(s.Ctx, pool.GetId(), s.TestAccs[0], incentiveCoin, osmomath.MustNewDecFromStr("9645.061724537037037037"), s.Ctx.BlockTime(), time.Nanosecond)
+	s.Require().NoError(err)
+
+	// Reset events
+	s.Ctx = s.Ctx.WithEventManager(sdk.NewEventManager())
+
+	// The check below shows that the incentive is not claimed due to truncation
+	s.Ctx = s.Ctx.WithBlockTime(s.Ctx.BlockTime().Add(time.Minute * 50))
+	incentives, _, err := s.App.ConcentratedLiquidityKeeper.CollectIncentives(s.Ctx, s.TestAccs[0], positionData.ID)
+	s.Require().NoError(err)
+	s.Require().True(incentives.IsZero())
+
+	// Truncation happens
+	events := s.Ctx.EventManager().Events()
+	s.Require().Equal(1, len(events))
+	s.Require().Equal(types.IncentiveTruncationPlaceholderName, events[0].Type)
+
+	// Reset events
+	s.Ctx = s.Ctx.WithEventManager(sdk.NewEventManager())
+
+	s.Ctx = s.Ctx.WithBlockTime(s.Ctx.BlockTime().Add(time.Minute * 51))
+	incentives, _, err = s.App.ConcentratedLiquidityKeeper.CollectIncentives(s.Ctx, s.TestAccs[0], positionData.ID)
+	s.Require().NoError(err)
+	s.Require().False(incentives.IsZero())
+
+	// Truncation event does not occur
+	events = s.Ctx.EventManager().Events()
+	s.Require().NotEqual(0, len(events))
+	for _, event := range events {
+		s.Require().NotEqual(types.IncentiveTruncationPlaceholderName, event.Type)
+	}
+}

x/concentrated-liquidity/types/events.go

@@ -48,4 +48,6 @@ const (
 	AttributeKeySpreadRewardGrowthOppositeDirectionOfLastTraversal = "spread_reward_growth"
 	AttributeKeyUptimeGrowthOppositeDirectionOfLastTraversal       = "uptime_growth"
 	AttributeNewOwner                                              = "new_owner"
+
+	IncentiveTruncationPlaceholderName = "concentrated_liquidity_incentive_truncation"
 )