Hackers Withdraw $300,000,000 in Bitcoin From Liquid Network, Claim Attack Is Friendly

Purported white-hat hackers have taken nearly 4,000 Bitcoin worth over $300 million from the wallet that backs the Liquid Network.

Liquid is a Bitcoin sidechain that allows users to move BTC onto a separate network for faster transfers, with the original coins held in a shared wallet.

The platform says the withdrawal occurred through the SideSwap Peg-out Authorization Key, though that key and others remained uncompromised.

Other assets on the network, including USDT, DePix, and RWAs, are unaffected.

Exchanges have been notified and are pausing or have already paused LBTC deposits and withdrawals.

Bridge nodes were temporarily disabled, effectively pausing the Liquid sidechain until the issue is resolved.

The Blockstream team is contacting the actors on-chain using a signed message.

“We are aware of a security incident on @Liquid_BTC. Purported white-hat hackers have withdrawn ~4,000 BTC (~$320 million) from the Liquid Federation wallet. The @Blockstream team is working on contacting them on-chain with a signed message…

What we know so far is that the funds were withdrawn via the SideSwap PAK (Peg-out Authorization Key), but that key was not compromised, nor were any others.”

Liquid wallets are impacted, but the federation is working to restore normal operations.

Bitcoin transactions continue to function normally on related services.

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