Liquid Network Halted After White Hat Hackers Withdraw $320 Million in BTC

The Liquid Network experienced a security incident on September 6 when white hat hackers withdrew approximately 4,000 BTC from its federation wallet. This amount is roughly 95% of the network's reported Bitcoin reserves at the time.

The funds were worth around $320 million. The incident occurred through the Peg-out Authorization Key (PAK), but Liquid claims that no keys were compromised in the process.

Liquid suspended network activity, turning off bridge nodes to prevent further transactions from being sent to the blockchain network. This move affected users' ability to send transactions to the blockchain network, with crypto exchanges notified about the security breach.