Liquid Network Halts Activity After $320M BTC Withdrawal

Liquid Network, a Bitcoin sidechain developed by Blockstream for faster settlement and digital-asset issuance, has paused new transaction activity after around 4,000 BTC was withdrawn from its federation wallet. The funds, worth approximately $320 million at the time, were taken through an authorized peg-out route.

The actors behind the withdrawal claim to be white-hat hackers who intend to return most of the funds once a vulnerability is patched. However, as of September 7, there had been no publicly confirmed return of the funds.

Liquid said it disabled bridge nodes and notified exchanges to suspend L-BTC deposits and withdrawals. The network is working with federation members to restore normal activity.