$320M Bitcoin Heist Exposes Liquid Network's Security Vulnerabilities

A $320 million Bitcoin heist has put the security of Liquid Network under scrutiny. Attackers stole approximately 4,000 BTC from the federation wallet, which is roughly 95% of its reserves.

The incident occurred when attackers claimed to be acting as 'white hats.' However, no independent confirmation has established their true intentions or confirmed that they acted ethically.

Liquid Network, launched by Blockstream in 2018, uses a federation model with over 80 exchanges, infrastructure companies, and asset managers. This security model is now under question due to the vulnerability exposed during the attack.

The attackers left an on-chain message for Liquid to contact them, but the return of the funds remains unconfirmed.