Lock, mint, burn, unlock - move tokens between chains and understand bridge risks
An attacker drained the bridge contract. Wrapped tokens on Chain B now have no backing on Chain A. Holders of wETH cannot redeem - their tokens are worthless.
1. Smart contract bugs - code vulnerability allows draining locked funds
2. Validator collusion - bridge validators approve fraudulent mints
3. Oracle manipulation - false confirmation of cross-chain state
When a bridge is hacked, wrapped tokens lose their 1:1 backing. The TVL (locked tokens) disappears but wrapped tokens still exist - creating unbacked IOUs.