Audit name:
[SCA] CPEG Coin | Re-Audit | May2026
Date:
Jun 16, 2026
Table of Content
Introduction
We express our gratitude to the CPEG COIN team for the collaborative engagement that enabled the execution of this Smart Contract Security Assessment.
Copper Coin (CPEG) is a fixed-supply ERC-20 token deployed on Ethereum Mainnet, where each token represents an peg to 1 lb of physical copper. The token is issued by AIC Stable Limited and is built on a minimal, non-upgradeable smart contract with no administrative privileges.
Document | |
|---|---|
| Name | Smart Contract Code Review and Security Analysis Report for CPEG COIN |
| Audited By | Khrystyna Tkachuk |
| Approved By | Seher Saylik |
| Website | https://cpeg.xyz→ |
| Changelog | 08/06/2026 - Final Report |
| Platform | Ethereum |
| Language | Solidity |
| Tags | ERC20 |
| Methodology | https://docs.hacken.io/methodologies/smart-contracts→ |
Document
- Name
- Smart Contract Code Review and Security Analysis Report for CPEG COIN
- Audited By
- Khrystyna Tkachuk
- Approved By
- Seher Saylik
- Website
- https://cpeg.xyz→
- Changelog
- 08/06/2026 - Final Report
- Platform
- Ethereum
- Language
- Solidity
- Tags
- ERC20
Review Scope | |
|---|---|
| Repository | https://github.com/cpeg-project/cpeg-token→ |
| Commit | 26f4531 |
Review Scope
- Commit
- 26f4531
Audit Summary
The system users should acknowledge all the risks summed up in the risks section of the report
Documentation quality
Functional requirements are provided.
Technical description is detailed.
NatSpec comments are sufficient.
Code quality
The code leverages OpenZeppelin contracts and follows established patterns.
The development environment is configured.
No security issues were identified during this audit. The reviewed implementation was found to be consistent with the expected behavior within the defined audit scope.
Test coverage
Code coverage of the project is 100% (branch coverage).
Deployment and basic user interactions are covered with tests.
System Overview
The system consists of a single smart contract, CopperPegCoin.sol, which inherits from the OpenZeppelin ERC20 base implementation (Solidity 0.8.25). The entire token supply of 1,800,000,000 CPEG is minted to a designated recipient address during deployment via the constructor. A zero-address check is enforced on the recipient parameter to prevent irrecoverable token loss at initialization.
The token has the following attributes:
Name: Copper Coin
Symbol: CPEG
Decimals: 18
Total Supply: 1,800,000,000 CPEG
The contract is intentionally designed with no custom logic beyond the constructor. No mint, burn, pause, blacklist, or ownership functions are exposed, meaning the token supply is permanently fixed at deployment and no privileged roles exist. All transfer, approval, and allowance functionality is inherited directly from the audited OpenZeppelin ERC20 library without modification or override.
This minimal design eliminates upgradeability, access control surfaces, and administrative intervention points. The contract contains no cross-contract dependencies beyond the imported OpenZeppelin ERC20 base, no external calls, and no state-modifying functions other than the inherited standard ERC-20 interface.
Files in Scope
CopperPegCoin.sol — Defines the CopperPegCoin ERC-20 token contract. The constructor accepts a
recipientaddress, validates it against the zero address, and mints the fixed total supply of 1,800,000,000 CPEG to that recipient. No additional functions are declared; all token operations (transfer,approve,transferFrom,allowance,balanceOf,totalSupply) are provided by the inherited OpenZeppelin ERC20 implementation.
Privileged roles
No privileged roles are defined in the in-scope contract. CopperPegCoin.sol inherits from OpenZeppelin's ERC20 base contract, which does not introduce any privileged access control.
Potential Risks
Entire Supply Minted to a Single Recipient: The CopperPegCoin constructor invokes _mint to allocate the full 1,800,000,000 CPEG supply to a single recipient address supplied as a deployment parameter, with only a zero-address check as validation. No on-chain multi-signature requirement, time-lock, or distribution schedule governs the choice of recipient or the subsequent movement of tokens. The initial distribution of the entire circulating supply is determined unilaterally by the deploying entity, and its correctness is not enforceable by the contract. This design concentrates 100% of the token supply in one address at launch, making the initial distribution and any subsequent market dynamics entirely dependent on the off-chain actions of that recipient.
No On-Chain Supply Reduction Capability: The CopperPegCoin contract inherits the base OpenZeppelin ERC20 implementation without the ERC20Burnable extension, providing no burn or burnFrom functionality. Tokens sent to inaccessible addresses or held by compromised wallets remain counted in totalSupply indefinitely, with no on-chain mechanism available to reconcile the circulating supply.
Absence of On-Chain Regulatory Primitives: The CopperPegCoin contract does not include any regulatory-enforcement primitives commonly expected of tokens marketed as stablecoins. No freeze, seize, blacklist, pause, burn, or upgradeability function is present, and no owner, role, or admin permission exists after construction. Any regulatory-compliance property associated with the token (KYC-gated distribution, sanction screening, lawful-order response, custodial warranties) must therefore be maintained entirely through off-chain processes. Holders, exchanges, and integrators cannot rely on the contract itself to enforce or demonstrate any compliance posture, and this limitation is permanent given the absence of upgradeability.
Off-Chain Copper Backing / Peg Dependency: Issuer materials describe CopperPegCoin as a stablecoin pegged to copper and backed by physical copper assets. The contract does not embed any reference to an off-chain reserve, price oracle, proof-of-reserve attestation, or redemption endpoint; the total supply of 1,800,000,000 CPEG is a fixed constant established at deployment. Whether the intended relationship between tokens and copper is unit-denominated (a fixed quantity of copper per token) or price-denominated, it is established, maintained, and verified exclusively off-chain through the issuer's mining, custody, and attestation operations. Reconciliation between the on-chain token supply and the underlying copper reserves, along with any redemption or peg-enforcement activity, is not observable or enforceable through the contract and depends entirely on the issuer's off-chain conduct and external attestations.
Findings
No vulnerabilities were foundAppendix 1. Definitions
Severities
When auditing smart contracts, Hacken is using a risk-based approach that considers Likelihood, Impact, Exploitability and Complexity metrics to evaluate findings and score severities.
Reference on how risk scoring is done is available through the repository in our Github organization:
Severity | Description |
|---|---|
Critical | Critical vulnerabilities are usually straightforward to exploit and can lead to the loss of user funds or contract state manipulation. |
High | High vulnerabilities are usually harder to exploit, requiring specific conditions, or have a more limited scope, but can still lead to the loss of user funds or contract state manipulation. |
Medium | Medium vulnerabilities are usually limited to state manipulations and, in most cases, cannot lead to asset loss. Contradictions and requirements violations. Major deviations from best practices are also in this category. |
Low | Major deviations from best practices or major Gas inefficiency. These issues will not have a significant impact on code execution. |
Severity
- Critical
Description
- Critical vulnerabilities are usually straightforward to exploit and can lead to the loss of user funds or contract state manipulation.
Severity
- High
Description
- High vulnerabilities are usually harder to exploit, requiring specific conditions, or have a more limited scope, but can still lead to the loss of user funds or contract state manipulation.
Severity
- Medium
Description
- Medium vulnerabilities are usually limited to state manipulations and, in most cases, cannot lead to asset loss. Contradictions and requirements violations. Major deviations from best practices are also in this category.
Severity
- Low
Description
- Major deviations from best practices or major Gas inefficiency. These issues will not have a significant impact on code execution.
Potential Risks
The "Potential Risks" section identifies issues that are not direct security vulnerabilities but could still affect the project’s performance, reliability, or user trust. These risks arise from design choices, architectural decisions, or operational practices that, while not immediately exploitable, may lead to problems under certain conditions. Additionally, potential risks can impact the quality of the audit itself, as they may involve external factors or components beyond the scope of the audit, leading to incomplete assessments or oversight of key areas. This section aims to provide a broader perspective on factors that could affect the project's long-term security, functionality, and the comprehensiveness of the audit findings.
Appendix 2. Scope
The scope of the project includes the following smart contracts from the provided repository:
Scope Details | |
|---|---|
| Repository | https://github.com/cpeg-project/cpeg-token/→ |
| Commit | 26f453127094dda9935f6a35ae3850649ec621ee |
| Whitepaper | N/A |
| Requirements | README.md |
| Technical Requirements | README.md |
Scope Details
- Commit
- 26f453127094dda9935f6a35ae3850649ec621ee
- Whitepaper
- N/A
- Requirements
- README.md
- Technical Requirements
- README.md
Assets in Scope
Appendix 3. Additional Valuables
Additional Recommendations
The smart contracts in the scope of this audit could benefit from the introduction of automatic emergency actions for critical activities, such as unauthorized operations like ownership changes or proxy upgrades, as well as unexpected fund manipulations, including large withdrawals or minting events. Adding such mechanisms would enable the protocol to react automatically to unusual activity, ensuring that the contract remains secure and functions as intended.
To improve functionality, these emergency actions could be designed to trigger under specific conditions, such as:
Detecting changes to ownership or critical permissions.
Monitoring large or unexpected transactions and minting events.
Pausing operations when irregularities are identified.
These enhancements would provide an added layer of security, making the contract more robust and better equipped to handle unexpected situations while maintaining smooth operations.
Frameworks and Methodologies
This security assessment was conducted in alignment with recognised penetration testing standards, methodologies and guidelines, including the NIST SP 800-115 – Technical Guide to Information Security Testing and Assessment →, and the Penetration Testing Execution Standard (PTES) →, These assets provide a structured foundation for planning, executing, and documenting technical evaluations such as vulnerability assessments, exploitation activities, and security code reviews. Hacken’s internal penetration testing methodology extends these principles to Web2 and Web3 environments to ensure consistency, repeatability, and verifiable outcomes.