Bridges concentrate cross‑chain risk and could trigger an FTX‑style crisis, CTO warns

Kadan Stadelmann, chief technology officer of Komodo Platform, wrote in Cointelegraph that crypto “bridges” — intermediaries that enable cross‑chain liquidity by issuing wrapped assets — concentrate trust and could spark a crisis comparable to FTX if a major collapse occurs. Stadelmann argues the industry handed control of cross‑chain liquidity to a handful of validators, custodians or multisig groups, describing wrapped assets as IOUs that create centralized choke points.

He cites the Multichain collapse and the Ronin hack as examples, and notes that more than $2.8 billion has been drained through bridge exploits to date, accounting for roughly 40% of all funds stolen in Web3. The article says wrapped‑asset systems concentrate risk into small operator sets or external consensus layers, so a single compromised key or exploit can undermine multiple protocols.

When a bridge fails, the effects ripple: lending markets can seize up, liquidity can vanish, and DeFi ecosystems that rely on wrapped BTC, wrapped ETH or wrapped stablecoins can lose their backbone overnight. As an alternative, Stadelmann promotes native trading — moving assets directly between users on their origin chains without wrapped representations or custodial intermediaries — and points to atomic swaps and hash time‑locked contracts as existing, if historically UX‑challenged, options.

Key Topics

Crypto, Cross-chain Bridges, Komodo Platform, Kadan Stadelmann, Wrapped Assets, Multichain