Liquid halts network after white-hat hackers withdraw $320M in Bitcoin

Liquid Network, a Bitcoin sidechain built and maintained by Blockstream, has temporarily halted its network after purported white-hat hackers took about 4,000 BTC, worth around $320 million, from the Liquid Federation wallet, the project said in a Sept. 6 statement.

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 Purported white-hat hackers have withdrawn ~4,000 BTC (~$320 million) from the Liquid Federation wallet.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…

— Liquid Network 🌊 (@Liquid_BTC) September 6, 2026

Blockstream said the withdrawal was carried out through the SideSwap PAK, or Peg-out Authorization Key. Neither the key nor any other keys were compromised, the team added.

Liquid has notified exchanges and paused Liquid Bitcoin (LBTC) deposits and withdrawals. The incident does not affect other Liquid assets such as USDT, DePix and tokenized real-world assets.

Bridge nodes have also been disabled, effectively pausing the Liquid sidechain and preventing new transactions from being submitted.

Blockstream is working to contact the purported white-hat hackers through an on-chain signed message while federation members work to restore network operations.

Liquid users of Aqua Bitcoin are seeing functionality impacts as teams work to resolve the ongoing security incident, according to Samson Mow, the founder and CEO of JAN3, the company behind the Aqua wallet.

Everyone is actively working to resolve this and we'll share information as the situation develops. As a @Liquid_BTC wallet, Liquid functionality in @AquaBitcoin is impacted, but Bitcoin transactions will still work normally.

These are difficult times but we'll pull through. 🙏 https://t.co/QFqCJuEfaJ

— Samson Mow (@Excellion) September 6, 2026

Mow said Bitcoin transactions on Aqua remain operational and will continue to work normally and that further information will be shared as the situation develops.

Liquid launched in 2018 with the goal of improving liquidity and speeding up Bitcoin transfers between exchanges, brokers and other users. Its early participants included Bitfinex, OKCoin, BitMEX and SIX Digital Exchange.

The network offers several features for faster and more private Bitcoin transactions, including L-BTC, which is backed by a two-way peg to Bitcoin. Liquid also enables Issued Assets with Bitcoin-like functionality for traditional assets and uses Confidential Transactions to improve privacy.