Liquid Network Bitcoin redemptions stay frozen amid 86% reserve backing
Image: Bitcoin.com NewsA vulnerability in Liquid Network's underlying Elements software let attackers drain roughly 4,000 BTC from the protocol's reserve more than 35 days ago. Roughly 3,400 BTC was returned by September 7, 2026, leaving a 598.5 to 603 BTC shortfall. The network restarted block production on September 10, 2026, but LBTC-to-BTC peg-out redemptions remain suspended. Liquid has stated redemptions will not resume until the reserve is fully backed and security reviews are complete.
Key points
- A bug in Liquid's Elements software let attackers drain roughly 4,000 BTC from the network's reserve.
- Liquid will only resume peg-out redemptions once its reserve is fully backed and security reviews are complete.
Why it matters
Liquid users cannot currently redeem LBTC for native BTC, and the 86% reserve backing means a full redemption rush could leave late redeemers unable to claim funds. Other assets on Liquid, including USDT, are operating normally.
Price context · BTC
At publication
$83,734.00
Now
$83,921.00
Change since
+0.22%
7 days · dashed line = publication
Sources · 2 publishers
Crypto Briefing
Tier 2
Liquid Network halts Bitcoin redemptions with reserves at about 86% coverage
Coverage timeline
- First reported by Bitcoin.com News
- Confirmed by Crypto Briefing
- CryptoVideos brief published
How this brief was made. Our system found this event in 2 independent publications, summarised two complete reports with AI and checked every number above against the source text. Sources are linked in full. Not financial advice. Report an error
