[L-01] Potential Reentrancy Vulnerability in Reward Distribution

[softstackio]

Likelihood: Low

Description
The _distributeRewards function in the BlockRewardHbbft contract contains a potential reentrancy vulnerability. Although the contract uses OpenZeppelin's ReentrancyGuard, the function makes an external call to TransferUtils.transferNative before updating the contract's state. This violates the checks-effects-interactions pattern.

TransferUtils.transferNative(governancePotAddress, shares.governancePotAmount);
// State changes follow external call
distributedAmount += poolReward;

While the ReentrancyGuard provides some protection, it's still best practice to follow the checks-effects-interactions pattern to minimize risk.

Recommendation:

1. Implement the checks-effects-interactions pattern by updating the contract's state before making external calls.
2. Move the Transfer Utils.transferNative call to the end of the function after all state changes.
3. Consider using OpenZeppelin's Address.sendValue for ETH transfers, which includes built-in reentrancy protection.