Liquid Network says $320 million in Bitcoin was drained in a cyberattack

Liquid Network said it lost about 4,000 of the 4,200 bitcoins held in a wallet used by the platform, and suspended all new transactions while the federation works to restore normal network activity. For high-risk payment and crypto operators, the important part is not just the size of the loss: it is that the breach hit infrastructure used for settlement, not a consumer-facing app with a bad password policy.

1. Bloomberg reported that the stolen amount was $320 million, based on Liquid Network’s own post on X. Liquid said the attackers appeared to be “white hat hackers” who exploit security vulnerabilities and often return the funds, sometimes for a reward.
2. Liquid Network said its wallets would be affected and that it had suspended all new transactions. The company added: “The members of the federation are actively working to resolve the issue and to be able to restore normal network activity.”
3. The funds were withdrawn through SideSwap, a licensed settlement platform authorized to handle transfers from the network, although Liquid said the key itself was not compromised. In other words, the access path mattered here, not just the custody layer.
4. Messages that appeared to be exchanges between the hackers and Blockstream were embedded in small Bitcoin transactions after Liquid’s announcement, according to blockchain tracker Mempool. The hackers said they would return the funds after confirming that the vulnerability had been fixed, but as of Monday morning in London, the money had not been returned.
5. Liquid Network was created in 2018 by Blockstream Corp., the blockchain technology company co-founded by Adam Back. It is now run by a federation of more than 80 exchanges, infrastructure companies and asset managers, according to Blockstream.

The attack lands in the middle of a rough patch for crypto security. Last week, an attacker stole $6 million from a digital asset lending platform linked to Crypto.com, and in August a cyberattack on Coldcard, an offline Bitcoin wallet, raised fresh questions about where digital assets are safest.