LIQUID NETWORK UPDATE: ECOSYSTEM ACTIVITY
Status as of September 17, 2026, 21:05 UTC

Network and Ecosystem Status

Since resuming on September 10, block production and network transactions, including LBTC transfers, have operated normally. Peg-out operations remain paused while work continues with Federation members and partners toward their safe restoration. Markets and services across the ecosystem are back online.

Mifiel has resumed the issuance and transactions of its digital promissory notes, with batches confirming normally. At the exchange level, BTSE reports that its platform has re-enabled USDT-Liquid transfers and the asset is unaffected by the incident.

AQUA reports that Liquid asset transfers and peg-ins are available. Its new swap feature, Indra, is also live, enabling swaps between LBTC and Lightning BTC, although liquidity remains limited.

Other wallets are restoring core functionality as well. Bull Bitcoin and the Blockstream App report that Liquid asset transfers are available, although LBTC<>BTC and LBTC<>Lightning swap routes on those services remain unavailable until peg-outs are restored.

Meanwhile, non-LBTC swap services are returning, with SideShift re-enabling cross-chain swaps for USDT and DEPIX on Liquid.

Please note service availability varies by provider, and users should confirm deposit, withdrawal and swap availability through each provider’s official channels.

BTC Recovery and Peg-Outs

As previously reported, 3,400 BTC of the ~4,000 BTC withdrawn on September 6 has been returned to the Federation reserve. Approximately 600 BTC remains unreturned, and efforts to pursue its recovery continue.

We understand that the central question for LBTC holders is when peg-outs will resume. While we are not yet able to provide a firm date, peg-outs will resume only after full 1:1 BTC backing for LBTC has been confirmed and all required software updates, testing and independent security reviews have been completed.

The Liquid Federation members and Blockstream will share the plan and timing for resuming peg-outs as soon as they are finalized.

Technical Post-Mortem

The root cause and exploit path have been identified, and the immediate fix was released in Elements v23.3.4. A comprehensive technical report detailing the incident will be released as soon as it is available.

Thank You

The Liquid Federation and Blockstream sincerely thank Federation member companies, ecosystem operators, developers, security researchers, and users for their continued work, patience and support throughout the recovery process.