L-BTC Trading Resumes with 85% Reserve Coverage
L-BTC resumed trading on Liquid after a network outage, but its reserves only cover about 85% of the outstanding supply. The split between L-BTC and BTC has given Liquid Bitcoin a market price before holders can redeem their tokens for the original cryptocurrency. According to Blockstream explorer endpoint readings, there were 4,229 L-BTC outstanding on September 10 at 22:55 UTC, while the federation reserve showed 3,601 BTC, leaving a gap of around 627 BTC.
SideSwap's markets reopened on Liquid despite the security review by the Liquid Federation. The trading venue and wallet operator described its swap as a central-limit-order-book-style market with L-BTC as the base asset. However, there is no direct order book for L-BTC/BTC.
The reserve figures indicate that price parity between L-BTC and BTC is not proof of backing, but rather a confidence signal. The near-parity price could be supported by expectations of recapitalization or a thin market with small orders offering worse execution for larger positions.