Allbridge Core Protocol Suffers $1.65 Million Loss from Flash Loan Attack
The cross-chain bridge protocol Allbridge has suspended its Core protocol due to a flash loan attack, with the attacker stealing approximately $1.65 million in assets from the Solana stablecoin liquidity pool.
The attacker borrowed $1.12 million via a flash loan from Kamino, manipulated the price mechanism within the pool through multiple stablecoin exchanges to acquire assets at a low price, and then transferred them across chains to Ethereum. This marks the second similar attack on Allbridge, following a loss of $573,000 in the BNB Chain pool in April 2023.
This incident has prompted liquidity providers to quickly withdraw their funds and turn to safer bridging protocols, with hackers and arbitrage traders becoming short-term beneficiaries. Allbridge now faces pressure for compensation and the costs of rebuilding trust, while compliant cross-chain infrastructure providers benefit from a relative advantage.
Source: Public Information
ABAB AI Insight
Allbridge previously experienced a similar flash loan attack in April 2023 on the BNB Chain liquidity pool and managed to recover most of the funds. This recent incident on the Solana chain continues to highlight historical issues with its price oracle and liquidity calculation mechanisms as a cross-chain bridge.
In terms of capital flow, the attacker quickly borrowed via a flash loan and manipulated the pool price through exchanges to facilitate fund transfer. The project team has paused the protocol and called on arbitrageurs to return profits for LP compensation, redirecting resources towards vulnerability fixes and liquidity pool removal, motivated by the need to stop losses and rebuild trust in the protocol.
Similar to multiple cross-chain protocols that have been hacked due to flash loan price manipulation between 2022 and 2024 (such as the Ronin or early Wormhole incidents), Allbridge is currently in a transformation phase from rapid iteration to strengthening security mechanisms in the cross-chain bridge industry.
Structural Judgment Essentially, this is a matter of technological substitution and industrial chain reconstruction: flash loan attacks expose the vulnerabilities of traditional AMM price mechanisms in high-leverage environments, driving cross-chain protocols towards more robust oracle and liquidity designs. Mechanically, this stems from the structural contradiction between reduced attack costs and delayed defenses, accelerating capital concentration towards well-audited infrastructures.
ABAB News · Cognitive Laws
- The cheaper the flash loan, the more fatal the liquidity pool vulnerabilities.
- Recovering funds is easy, rebuilding trust is hard.
- The faster the cross-chain speed, the more delayed the security patches.