Liquid Network was hacked by “white-hat” hackers, losing $320 million in Bitcoin; the funds are currently under control
2026-09-07 21:26Cybersecurity🔥 54.3 heat score
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On September 7, 2026, the Bitcoin sidechain Liquid Network experienced a security incident. The attacker, who claimed to be a “white-hat hacker,” used the authorized keys (PAK) of the SideSwap platform to transfer approximately 4,000 Bitcoins (valued at about $320 million), accounting for 95% of the total funds held by the network’s wallet members. Liquid Network officially stated that the attacker communicated with Blockstream via on-chain messages, promising to return the funds after the vulnerabilities were fixed and nodes updated. Currently, Liquid Network has suspended deposit and withdrawal services for L-BTC and closed the related bridging nodes. Although the hacker claimed that the private keys were not leaked and the operation is still under investigation, the stolen Bitcoins are still under the control of the attacker. This incident indicates that integrating Bitcoin into a sidechain does not fully inherit the security model of the main network, as the funds of Liquid are managed jointly by members of the alliance rather than relying on miner protection. Other assets such as USDT and DePix have not been affected, but…
On Sunday, the Bitcoin payment network Liquid Network was hacked by “white hat hackers”, resulting in the theft of approximately 4,000 Bitcoins worth about $320 million, which caused the sidechain to suspend operations. The hackers transferred funds through the SideSwap platform, which allowed authorized withdrawals, without disclosing keys and leaving on-chain messages promising to fix the vulnerabilities before returning the funds. Liquid stated that Blockstream was contacting the responsible parties, but did not reveal their identities, explain the root cause of the vulnerability, or confirm the recovery of the funds. This incident raised questions about the security of Liquid’s model and the SideSwap platform’s mechanisms. Other assets managed by Liquid, such as USDT and DePix, were not affected, but wallet services will be disrupted as a result.
The Bitcoin payment and settlement network Liquid Network revealed on Sunday that attackers, claiming to be white-hat hackers, transferred 4,000 Bitcoins worth $320 million from their coalition wallet. The coalition wallet contained a total of 4,200 Bitcoins. It is believed that the attackers exploited a vulnerability that was fixed last week. Blockstream, the developer of Liquid Network, attempted to communicate with them through on-chain signature messages; the hackers stated that they would return the Bitcoins after ensuring all nodes were patched. Currently, these Bitcoins remain firmly in the hands of the hackers.
The hackers claimed to be “white-hat hackers” and stole approximately 4,000 Bitcoins (worth about $320 million) from the Liquid Network alliance wallet, accounting for 95% of their total holdings. Liquid Network issued a statement on X stating that the incident was carried out by so-called “white-hat hackers,” and immediately shut down the bridging nodes, asking the exchange to suspend deposits and withdrawals of L-BTC. The hackers referred to themselves as “white-hats” in embedded messages in Bitcoin transactions, asking Blockstream to contact the security team and promising to return most of the funds after fixing the vulnerabilities and updating the nodes. Liquid noted that the funds were transferred using SideSwap’s Peg-out authorization key (PAK), but the PAK itself was not leaked, and the exact method of transfer is still under investigation. This incident shows that adding Bitcoin to a sidechain does not equate to gaining security protection for Bitcoin, as Liquid manages its funds jointly by alliance members rather than relying on miners. Currently, other assets and the main Bitcoin network have not been directly affected; it remains to be seen whether the stolen funds…