Allbridge Core Halts Operations After $1.65 Million Exploit

Allbridge Core, a crucial cross-chain bridge for stablecoin transfers, has suspended its operations after suffering a security exploit amounting to approximately $1.65 million. According to reports from blockchain security firm PeckShield, the attack impacted the Solana-based infrastructure, and the stolen funds were swiftly moved from Solana to the Ethereum network.

Detailed investigations by on-chain analysts reveal that the attack commenced with a $1.12 million USDC flash loan. The attacker obtained this loan via the Kamino protocol on the Solana network. Subsequently, they manipulated the USDC and USDT ratios within Allbridge Core's stablecoin liquidity pool through rapid swap transactions. This manipulation distorted the pool's internal exchange rate calculations, creating an artificial imbalance. The attacker then withdrew liquidity at these manipulated rates, repaying the flash loan within the same transaction and retaining the difference as profit. The stolen assets were later routed through privacy protocols to obscure their movement.

Allbridge's team confirmed the security incident, stating they paused the protocol as a precaution while investigations are underway. The project urged users with liquidity in affected pools to withdraw their funds immediately. Furthermore, they requested individuals who profited from the temporary arbitrage opportunity to voluntarily return the funds, which would be used to compensate affected liquidity providers.

This is not the first attack Allbridge has faced. The protocol previously lost approximately $573,000 in a similar flash loan attack on its BNB Chain pool in April 2023. In that incident, the attacker exploited a flaw in a smart contract to manipulate swap prices, and a significant portion of the stolen funds (around $465,000) was reportedly recovered through a white-hat hacker arrangement. However, the scale of this latest attack is larger, and the movement of funds through privacy protocols could complicate recovery efforts. This event led to a drop in Allbridge's Total Value Locked (TVL) from $21.61 million to $12.78 million.

Despite their vital role in enabling the transfer of funds across different blockchains, cross-chain bridges continue to be attractive targets for attackers within the crypto ecosystem. This incident marks at least the sixth cross-chain bridge attack since May, contributing to total losses of $57.8 million in crypto protocols in July 2026. Bridges often hold large pools of funds, making them primary targets for cybercriminals. On-chain analysts note that moving stolen funds through privacy protocols will complicate recovery efforts. However, given that the loss is relatively small compared to Solana's overall market capitalization, the direct impact on the network's price is not expected to be significant. The market will closely monitor whether the Allbridge team can achieve a similar recovery success as in their previous incident.