Allbridge Core attack lost $1.65 million, attackers transferred funds to Ethereum

Allbridge Core was hacked and lost US$1.65 million. Funds were transferred to Ethereum

cross-chain protocol Allbridge Core recently suffered a security breach, resulting in a loss of US$1.65 million in its deployment on the Solana chain. After the incident, the agreement immediately suspended all operations, and the team immediately launched an investigation to determine the cause of the attack and the scope of its impact.

Flash loan attack targets Solana funds pool

This attack occurred on Allbridge's Solana-based stablecoin bridge, and the project party quickly confirmed it. Allbridge suspended all activities and security teams and independent blockchain investigators began reviewing the impact of the incident.

According to research by blockchain analysis company Lookonchain, attackers quickly bridge all stolen assets to Ethereum and exchange them for ETH. These rapid transfers make it more difficult to recover funds and highlight the rapidly evolving nature of cross-chain attacks.

After Allbridge suspended operations due to a $1.65 million attack on the Solana fund pool, the attacker immediately transferred the stolen money to Ethereum and exchanged it for ETH, raising concerns about the continued security risks of the cross-chain protocol.

Further blockchain analysis revealed that the attacker used a US$1.12 million USDC flash loan borrowed from Solana liquidity protocol Kamino to launch the attack. By performing multiple transactions within a single block, the attacker temporarily exchanged USDC and USDT tokens, manipulating the exchange rate within the Allbridge Core stablecoin pool.

This price manipulation allows attackers to withdraw more stablecoins than the initial supply, making huge profits without holding borrowed funds for a long time. After repaying the flash loan, the attackers retained approximately $1.65 million in proceeds. Subsequently, the attackers tried to hide the funds through privacy channels on Ethereum.

Allbridge calls on liquidity providers in the affected pool to withdraw funds during the investigation. The agreement also requires users who profit from temporary arbitrage opportunities related to the attack to voluntarily return funds to compensate liquidity providers who suffer losses.

Small Dictionary: Flash loan-a mortgage free loan that allows users to borrow large amounts of money in a single blockchain transaction, often used for arbitrage, or in some cases to exploit protocol loopholes.

Cross-chain bridge security concerns intensify

This attack is not the first time Allbridge has encountered a security incident. The agreement previously suffered a flash loan attack in 2023, causing losses to its BNB Chain deployment of more than $573,000. In both incidents, the attacker succeeded by manipulating the exchange price in the liquidity pool.

Cross-chain bridges like Allbridge make attractive targets because of the large amount of liquidity they handle for asset transfers between independent blockchains. Successful attacks often cause significant financial losses to multiple networks in a short period of time.

Recently, other bridging platforms including Taiko, Secret Network, Gravity Bridge, Verus Bridge and Butter Network have also encountered similar security vulnerabilities. These incidents highlight the importance of thoroughly reviewing smart contracts, establishing robust monitoring mechanisms, and improving liquidity protection in decentralized financial systems.

Blockchain security teams such as PeckShield and CertiK quickly identified the Allbridge vulnerability after detecting abnormal on-chain activity. Investigators are still analyzing transaction history to fully reconstruct the attack process and support possible financial recovery.

The investigation continues, and Allbridge is evaluating potential security upgrades and seeking compensation options for those affected. Despite the continuous advancement of decentralized financial platform security technologies, recurring incidents have highlighted the ongoing challenges facing cross-chain infrastructure.