Liquid Network Paused After $320M Bitcoin Withdrawal
- Approximately 4,000 BTC, valued at $320 million, was withdrawn from the Liquid Federation wallet.
- The withdrawal utilized SideSwap’s peg-out key, which remained uncompromised according to Liquid.
- The incident is attributed to a bug in Elements, not a breach of federation keys.
- Blockstream’s Liquid sidechain has been paused since the event on Sunday.
- The wallet now holds roughly 200 BTC, about five percent of its previous balance.
A security incident involving purported white-hat hackers led to the withdrawal of approximately $320 million worth of Bitcoin from the Liquid Federation wallet using SideSwap’s peg-out key without compromising it. The issue is linked to a bug in Elements software, prompting Blockstream to pause the Liquid sidechain as they work on addressing the vulnerability.
This event highlights the critical need for robust security measures in blockchain technology as vulnerabilities can lead to significant financial impacts and operational disruptions within cryptocurrency networks.(Source)
