Key facts
- Liquid Network is in final stages of recovery after a hack.
- Hackers stole 4,000 bitcoin, worth about $320 million at the time.
- Hackers exploited an inflation bug to create unbacked LBTC tokens.
- Most of the stolen bitcoin was returned to Blockstream.
- Hackers retained approximately 600 bitcoin, worth close to $50 million.
- Phased swaps have been reintroduced on the Liquid Network.
The Liquid Network stated on Tuesday that it is nearing the completion of its recovery process following a significant hack that occurred in September. Hackers exploited an inflation bug on the sidechain to create over 4,000 LBTC tokens, which they then exchanged for 4,000 real bitcoin, valued at approximately $320 million at the time. Blockstream, the creator of the Liquid Network, successfully negotiated the return of most of the stolen funds. The hackers, however, retained about 600 bitcoin, roughly 15% of the total, which is now valued at close to $50 million. The network is implementing enhanced security measures as part of its recovery. Phased swaps have been reintroduced, and Blockstream CEO Adam Back confirmed on X that these operations are now functional.