A Bitcoin-backed blockchain utilized by numerous cryptocurrency exchanges has been compromised in a hacking incident, leading to damages of $320 million. This event marks the latest in a string of thefts, shaking confidence in the safety of digital assets.
The Liquid Network, a blockchain developed to accelerate transaction speeds, reported via a post on X that its Liquid Federation wallet held approximately 4,200 BTC, of which roughly 4,000 were stolen. Liquid indicated that the parties involved are "allegedly white-hat hackers," a term for security experts who transfer funds after identifying vulnerabilities, typically with the intention of returning them, often for a fee.
Liquid Network stated, "Liquid wallets will be affected, and we deeply apologize for any inconvenience caused," adding that all new transactions have been suspended. Members of the federation are actively working to resolve the issue and restore normal network operations.
This hacking incident stands as the most recent in a series of attacks, bringing the issue of security within cryptocurrency networks into sharp focus. Just last week, an attacker stole $6 million from a digital asset lending platform associated with Crypto.com. In August, a hack targeting Coldcard, a popular Bitcoin cold wallet, also raised questions about the safest methods for storing digital currency.
The Liquid Network was established in 2018 by blockchain technology firm Blockstream Corp, whose co-founders include Adam Back, a cryptographer turned Bitcoin advocate. Blockstream claims the Liquid Network is now overseen by a consortium of more than 80 exchanges, infrastructure companies, and asset management firms. Neither Liquid Network nor Blockstream responded immediately to requests for comment via email.
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