Alleged White-Hat Hackers Withdraw 4,000 bitcoin from Blockstream’s Liquid Network Federation Reserves

Bitcoin Magazine Alleged White-Hat Hackers Withdraw 4,000 bitcoin from Blockstream’s Liquid Network Federation Reserves The Liquid Network said Sunday that purported white-hat hackers withdrew about 4,000 bitcoin, worth about $320 million, from the federation wallet that backs L-BTC.

Bridge nodes were disabled, and the sidechain was paused. Other issued assets, including USDT, DePix and RWAs, were unaffected, the official account said on X. The Liquid Network is a federated sidechain of Bitcoin, founded by Adam Back’s Blockstream.

The Liquid chain issues a variety of assets such as LBTC, which it backs with BTC on the Bitcoin main chain, held in a large multisig of 15 corporate and known members. 11 of the 15 members need to sign a valid multi-signature transaction to move coins from the treasury.

Before the hack, the treasury held over 4200 BTC; after the hack, Blockstream’s proof of reserves page reports a little over 207 BTC left.  The hackers withdrew 4,019.4 BTC from the reserve address in a peg-out transaction using the SideSwap Peg-out Authorization Key.