Liquid Network resumed block creation after the Bitcoin withdrawal of $320 million, although transactions and operations involving bindings remain suspended while recovery work continues.
In a Thursday post on X, Liquid said that block creation resumed «without transactions» as a precautionary measure while the network is monitored for «confirmation of full stabilization». The necessary updates for functional and bridge nodes have been deployed, and now functional nodes are signing and verifying blocks properly.
Peg-linked operations, including withdrawals from the peg, authorized by PAK, remain paused while the network works on restoring the BTC/L-BTC reserve.
The day before, Liquid released an emergency update for Elements—software underlying the network—to address a proof-checking cache vulnerability related to the incident. The Elements v2334 update strengthened the cache keys used for range proofs as part of the network recovery plan.
Source: Liquid Network
$270 million in bitcoin returned after the exploit
Liquid paused operations on September 6 after self-described “white hat” hackers withdrew from the network’s federated wallet about 4,000 bitcoins (BTC), worth roughly $320 million.
The payout was about 95% of the roughly 4,200 BTC balance in the wallet and included L-BTC whose origin was linked to a bug in Elements—the open-source software underlying Liquid.
Subsequently, the attackers returned 3,400 BTC worth about $270 million at the time, after Blockstream confirmed that the affected bridge nodes had been updated. As of September 7, about 598 BTC, worth approximately $46 million at current prices, remained unrecovered.