Allbridge pauses cross-chain bridge after $1.65M exploitThe attacker allegedly used a flash loan and rapid swaps to manipulate the bridge’s stablecoin exchange rate.
Reported by Cointelegraph · AI-assisted summary by ChikoCorp AI News Desk
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Allbridge, the operator of the cross-chain stablecoin bridge Allbridge Core, has paused its protocol following a security incident on Sunday that resulted in the loss of approximately $1.65 million. The breach specifically targeted the Solana deployment of Allbridge Core. The attacker quickly bridged the stolen funds from Solana to Ethereum and moved them into privacy pools. Allbridge announced the pause on X (formerly Twitter), advising users with liquidity in affected pools to withdraw their assets immediately as the investigation continues.
According to on-chain analytics reported by Lookonchain and Onchain Lens, the attacker executed a $1.12 million USDC flash loan from Kamino, then engaged in rapid USDC/USDT swaps that disrupted the stablecoin pool’s exchange rate on Allbridge Core. This manipulation created a temporary arbitrage opportunity, allowing the attacker to withdraw liquidity at manipulated rates, repay the flash loan, and pocket the difference. Allbridge has requested that anyone who profited from this arbitrage consider returning funds to help compensate affected liquidity providers.
This is at least the sixth attack on cross-chain bridges since May, highlighting the continued vulnerability of these protocols due to the large pools of funds they hold. Allbridge Core has been previously exploited in April 2023 by a flash loan attack that drained $573,000 through manipulation of swap prices on its BNB Chain pool. The report highlights similar recent exploits on other cross-chain bridges, including a $1.7 million theft from Taiko in June and a $4.67 million exploit on Secret Network caused by an “infinite mint” bug.
This ongoing series of bridge exploits underscores the inherent risks in cross-chain infrastructure and the difficulties in securing large liquidity pools used to facilitate asset transfers across blockchains. Allbridge's public communication and the history of these attacks illustrate the challenges of maintaining security and user trust in rapidly evolving DeFi environments.