Liquid Network Resumes Block Production After $320M Hack
The Liquid Network has restarted its block production after a major hack drained approximately $320 million from its federation wallet. On September 10th, the network initially kept transactions disabled but gradually progressed to resume transactions later in the evening.
The restart was cautious due to a proof-verification cache vulnerability that affected the underlying Elements software. Blockstream has intentionally disabled peg-outs, which is the process of moving LBTC from Liquid back to the Bitcoin network while receiving BTC in return, until it is confident in the Liquid network's internal state and the BTC/LBTC reserves have been correctly restored.
The hack resulted in the theft of around $320 million worth of Bitcoin. However, a significant portion of the stolen funds has been recovered, with white hat hackers returning 3,400 BTC, worth approximately $268 million. This amounts to roughly 85% of the Bitcoin withdrawn during the incident.