Liquid Network Recovers 3,400 BTC Following Bridge Exploit
The Liquid Network has reclaimed 3,400 BTC, roughly 85% of the 4,000 BTC withdrawn during a recent bridge exploit. While the assets were returned following a series of on-chain messages between the developers and the anonymous actors, nearly $47 million worth of Bitcoin remains outstanding in the unauthorized address.
By WildWeb24·September 7, 2026·2 min read·447 reads
The repayment occurred in Bitcoin block 965,950 after Blockstream communicated with the actors via transaction messages. The group had initially demanded that the bridge nodes be patched before they would return the funds, claiming the action was a white-hat intervention to expose security flaws. Blockstream confirmed the patches were implemented, leading to the partial recovery of the stolen capital.
Despite the return of the 3,400 BTC, approximately 598.5 BTC remains in the possession of the actors. Neither Blockstream nor the individuals involved have disclosed terms regarding a bounty or explained why a portion of the funds was retained. This ambiguity drew criticism from industry observers, including Ledger CTO Charles Guillemet, who characterized the retention of nearly 600 BTC as potential extortion rather than a standard bug bounty operation.
Liquid Network, a federated Bitcoin sidechain, has kept its bridge nodes and L-BTC services suspended while developers continue to investigate the breach. The company has yet to provide a full technical post-mortem or clarify how it intends to address the remaining discrepancy in the network's backing. For now, users remain unable to perform peg-out operations, as the bridge remains offline pending further security assessments.
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