The Liquid Network, a Bitcoin sidechain used by multiple cryptocurrency exchanges for faster settlement, suffered a security breach that led to the loss of roughly $320 million. The platform announced on X that 4,000 of the 4,200 Bitcoin stored in a single wallet were taken.
Liquid Network described the perpetrators as "white‑hat hackers" who exploit vulnerabilities and typically return funds, sometimes for a fee. The network immediately stopped all new transactions while its federation – a consortium of more than 80 exchanges, infrastructure firms and asset managers – works on restoring normal activity.
The incident follows a series of recent crypto‑sector breaches. Last week, an attacker withdrew $6 million from a Crypto.com‑linked digital‑asset lending platform, and in August a hack of the Coldcard hardware wallet raised questions about offline storage security.
Founded in 2018 by Blockstream, the Liquid Network issues a token called L‑BTC that is backed 1:1 by Bitcoin locked on the main chain, enabling quicker and cheaper transfers. Blockstream and Liquid Network did not respond to email requests for comment.
The theft underscores ongoing concerns about the safety of digital assets held on centralized or federated platforms, especially as Bitcoin’s base layer faces congestion and high fees that drive users to sidechains like Liquid.
