The deposit lifts the Liquid federation wallet to a 94.14% backing ratio as recovery from the September exploit continues
Blockstream has transferred 300 BTC into the Liquid Federation wallet. The deposit shrinks the network’s reserve shortfall to 250 BTC.
That leaves Liquid closer to full backing than at any point since a September exploit drained its reserves. Peg-out redemptions stay frozen until every L-BTC is matched by real Bitcoin.
The numbers behind the 300 BTC deposit
The transfer landed on November 2, 2026. Before it arrived, the gap between issued L-BTC and the Bitcoin held in reserve stood at approximately 550 BTC.
After the deposit, the federation wallet holds 4,018.95 BTC. Meanwhile, 4,268.95 L-BTC remains in circulation.
Divide one by the other and you get a backing ratio of 94.14%. Put more simply, roughly 94 cents of real Bitcoin now sits behind every dollar’s worth of L-BTC, with the remaining 250 BTC still owed.
This latest deposit was not the first step back. On October 27, 2026, a test transaction of roughly 2.53 BTC moved as part of the gradual effort to restore the reserves. The 300 BTC transfer is the far larger follow-through.
How Liquid ended up short in the first place
The trouble started on September 6, 2026. Attackers exploited vulnerabilities in Elements, the software that underpins the Liquid Network, and pulled out approximately 4,000 BTC.
The exploit also left unbacked L-BTC floating around the system.
Negotiations followed. Approximately 3,400 BTC was returned to the network.
That still left an estimated 600 BTC hole. Blockstream, led by CEO Adam Back, pledged to cover the remaining shortfall internally rather than pass the losses on to users.
In the meantime, the company has worked on more than just refilling the reserves. External security audits were completed by October 20, 2026. Blockstream also rolled out software upgrades and changed how keys are managed, aiming to close off the path the attackers used.
What the shrinking gap means for Liquid users
The most immediate stakeholders are L-BTC holders. They currently hold an asset they cannot redeem for native Bitcoin, because peg-outs remain halted until the network reaches 100% reserve backing.
Still, 94.14% is not 100%. Until the last 250 BTC arrives, holders sit in an awkward middle ground where their tokens are mostly backed but not fully redeemable.
There are a few things to watch from here. The first is whether, and when, Blockstream deposits the final 250 BTC. The second is the timing of the peg-out restart once backing reaches 100%, since that is the moment holders can test the recovery for themselves.
