Allbridge Pauses Core After $1.65M Flash-Loan Attack on Solana
Allbridge has paused its Core cross-chain protocol after a $1.65M flash-loan attack hit its Solana liquidity pools. Security firms and Allbridge say the attacker used about $1.12M borrowed via Kamino, then executed fast USDC/USDT swaps to distort the pools’ internal pricing.
With the pricing skewed, the attacker reportedly traded a few thousand USDT for about $2.24M USDC, bridged the funds to an Ethereum address, and dispersed them across multiple wallets. Allbridge urged liquidity providers to withdraw from affected pools and said it paused Core “as a precaution.”
The imbalance created a “temporary positive arbitrage window.” Allbridge asked traders who profited during the flash-loan attack to return funds to a designated address intended to compensate affected LPs. In a follow-up update, it said there is no threat to user liquidity “right now,” it is preparing a detailed post-incident breakdown, and it plans to relaunch without the liquidity pools.
This is the second time Allbridge has faced a similar flash-loan attack. In April 2023, roughly $573K was drained from its BNB Chain pools, after which it revised liquidity and withdrawal calculations. Traders should watch whether the bridged ETH-linked funds can be traced and whether arbitrage participants actually return capital.
Neutral
The news is largely specific to Allbridge’s Core contracts and Solana liquidity pools, and the reported loss size (about $1.65M) is small relative to the broader USDC/USDT/SOL ecosystem. Allbridge also says there is no immediate threat to user liquidity, and it is preparing a breakdown while planning a relaunch without the vulnerable liquidity pools. For traders, the key watch items are whether bridged ETH-linked funds are traceable and whether arbitrage profits are returned—factors that could reduce uncertainty, but are unlikely to materially drive sustained price moves in SOL/ETH/USDC/USDT. Historically similar incidents have not caused broad, persistent market dislocations, so the expected market impact on the mentioned cryptocurrencies is neutral.