Allbridge Core lost $1.65 million due to Solana vulnerability, suspended operations

Allbridge Core suspends cross-chain stablecoin protocol due to security breach

Allbridge Core has suspended its cross-chain stablecoin protocol following a security incident in the Solana blockchain. The incident could result in losses of up to $1.65 million. The Allbridge Core team has advised liquidity providers to withdraw assets from the affected pool, and the security team is currently investigating the exploit.

According to blockchain security company PeckShield, the attack caused approximately US$1.65 million in damage. Blockchain analytics firm Onchain Lens said the attackers used an advanced liquidity pool manipulation scheme to extract more than $1.1 million from Allbridge Core. A final damage assessment is still in progress.

Target: Allbridge Core stablecoin pool

The official announcement of the project stated that the Allbridge Core protocol has been temporarily suspended due to the discovery of suspicious activity. The team also recommends that users holding funds in the affected liquidity pools immediately withdraw assets.

Preliminary online data shows that the attacked liquidity pool was the USDC/USDT pool of Allbridge Core. According to Onchain Lens, the attacker then borrowed a USDC flash loan of $1.12 million from Kamino and completed multiple quick conversions between USDC and USDT.

Lightning Loan manipulates Allbridge Core Fund Pool

According to reports, due to differences in the balance of the liquidity pool, large transactions led to price imbalances in the pool. The attacker then adjusted the exchange rate, withdrew the funds on favorable terms, and repaid the lightning loan in the same transaction, withdrawing the remaining funds from the Allbridge Core agreement as profit.

Lightning loans allow users to borrow large amounts of cryptocurrency without providing any collateral, provided they can repay the loan before the transaction on the blockchain ends. In this case, the vulnerability itself was not a flash loan, but the attacker was able to effectively manipulate the pricing of the Allbridge Core fund pool.

PeckShield later stated that stolen assets had been transferred from Solana to Ethereum, which could make it more difficult to recover assets.

Allbridge Core launches recovery process

Allbridge Core confirmed that after the attack, the liquidity pool was temporarily unbalanced, providing traders with arbitrage opportunities. The project party calls on all those who have benefited from these abnormal market events to voluntarily return the funds to the recovery wallet. The team said the funds will be used to compensate affected liquidity providers.

The agreement has not announced when Allbridge Core services will resume, nor has it released a detailed technical analysis of the attack.

Cross-chain security risks continue to grow

This incident is the latest in a series of security issues at Allbridge Core. The agreement was attacked in April 2023, when a hacker modified the price of tokens in a liquidity pool on BNB Chain, causing a loss of approximately $573,000. The project company later provided a white hat reward to the attackers, and part of the funds were eventually recovered.

The recent Allbridge Core attack highlights ongoing security issues in the cross-chain ecosystem. In recent months, multiple cross-chain bridges have been targeted, such as Verus-Ethereum and Transit Finance. This further demonstrates that bridging vulnerabilities in liquidity manipulation and verification remain an open challenge in the DeFi space.

Conclusion

The Allbridge Core incident highlights the security risks of cross-chain protocols, and investigations into stolen assets are still ongoing. Market participants will pay close attention to the project's technical investigation results, recovery progress, and any other security measures taken before the agreement resumes operations.

Summary

Allbridge Core suspended its agreement after a suspected $1.65 million attack on the Solana chain. The attackers allegedly used a $1.12 million flash loan to manipulate the liquidity pool. As the investigation continues, this incident highlights ongoing cross-chain security risks.

Key Glossary

Allbridge Core: A protocol used to transfer stablecoins across chains.
Flash loan: Loan repaid in the same blockchain transaction.
PeckShield: A blockchain security company.
Onchain Lens: A blockchain analytics platform.
Arbitrage: Profit from market price differences.
Recovery wallet: A wallet used to receive recovered funds.
DeFi: Financial services based on blockchain.
White-hat bounty: Reward given to ethical hackers.

Frequently asked questions about the Allbridge Core attack

1. Why did Allbridge Core suspend its agreement?
The agreement suspended operations after a suspected $1.65 million attack on the Solana chain.

2. How was the attack carried out?
The attackers allegedly used a $1.12 million flash loan to manipulate the liquidity pool.

3. What should affected users do?
Withdraw funds from affected liquidity pools.

4. Has the agreement resumed operations?
No, the investigation is still in progress.