$320M Hack Halts Liquid Network, Leaving L-BTC Value in Limbo

The Liquid Network, a Bitcoin sidechain, has been paused due to a $320 million hack. The hackers drained roughly 4,000 BTC from the federation wallet on Sunday.

L-BTC, the network's native currency, is now backed by only 4.7% of the required bitcoin, as there are only 197 BTC left in the federation's wallet.

In a recent development, the attackers, who claim to be a 'white hacker', said they'll return 'the money back safely' once a bug that allowed this theft is fixed. Blockstream responded with 'Yes, thank you,' and added that 'Bridge nodes are patched, safe to return the funds.'

The biggest question now is what L-BTC will be worth when peg-outs resume, and who will absorb any shortfall.