Liquid Network Halts After $320M Bitcoin Drained — SkimNews
Get the Tech newsletter
Daily tech — startups, AI labs, chips, the launches that shape the next decade. Free.
- Blockstream's Liquid Network halted new transactions after "purported white-hat hackers" withdrew approximately 4,000 of the 4,200 bitcoin held in its federation wallet, valued at around $320 million.
- The Liquid attacker stated they will return most of the 4,000 BTC after a bug fix is implemented, according to The Block's reporting on the incident.
- CryptoSlate suggested that tokens "created out of thin air" may explain how the bitcoin was able to leave the Liquid sidechain — pointing to a flaw in how balances were validated.
- The Cardano founder highlighted solutions to growing AI threats in the wake of the breach, per The Crypto Basic's coverage, framing the incident as part of a broader security concern.
- The Liquid Network functions as a Bitcoin-based settlement network used by cryptocurrency exchanges, per Reuters and Bloomberg's parallel reporting on the incident.
Why it matters: Blockstream's Liquid Network is a settlement layer relied on by crypto exchanges, and the draining of roughly $320 million from its federation wallet exposes a structural vulnerability in sidechain infrastructure. With the attacker's promise to return funds contingent on an unfixed bug, exchanges and users dependent on Liquid for fast settlement face uncertainty about when — or whether — operations fully resume.
Ask SkimNews
