Tuesday 15 September 2026
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Crypto

Hacker Returns Most of $340M Stolen from Crypto Settlement Network After Bug Fixed

Liquid Network exploit sees approximately $47 million still unaccounted for as operations remain paused

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By LineZotpaper
Published
Read Time2 min
A hacker stole roughly $340 million worth of bitcoin from Liquid Network, a settlement exchange used by multiple cryptocurrency platforms, in one of the largest crypto heists this year — but has returned most of the funds after the bug that enabled the theft was patched, according to a former Blockstream executive.

Liquid Network, launched in 2018 by crypto firm Blockstream, said in a post on X on Sunday that a "white hat" hacker stole the funds from the network's wallet and that operations have been paused until the incident is resolved.

Crypto media reports indicate the hacker allegedly exploited a bug to withdraw the funds and offered to return them if Blockstream fixed the vulnerability.

Former Blockstream executive Samson Mow posted on X on Monday that the company had fixed the bug, and around 3,400 of the roughly 4,000 stolen bitcoins — representing most of the funds — had been returned. The remaining approximately 600 bitcoins, worth about $47 million, remained under the hacker's control.

Mow said operations will stay paused until additional fixes and security improvements are made before the network restarts.

The theft ranks among the largest heists of digital funds to date, according to the Rekt leaderboard, which tracks cryptocurrency thefts.

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Analysis

Why This Matters

  • The heist underscores persistent security vulnerabilities in the cryptocurrency ecosystem, even at institutional-grade settlement layers like Liquid Network.
  • The rapid return of most funds after a bug fix highlights how white-hat hacking dynamics can shape outcomes in crypto — but the unresolved $47 million remains a concern for affected exchanges and users.
  • The pause in Liquid Network operations could disrupt cryptocurrency exchanges that rely on it for settlement and trading.

Background

Liquid Network is a Bitcoin sidechain designed to enable faster, more confidential transactions and asset issuance between exchanges and institutional traders. It was developed by Blockstream, a company known for its work on Bitcoin infrastructure. Theft of digital assets has been a recurring issue in the crypto space, with high-profile hacks often targeting exchange wallets or smart contract bugs.

Key Perspectives

Blockstream and Liquid Network: The company has acknowledged the exploit, paused operations, deployed a fix, and is working to recover the remaining funds while enhancing security. The Hacker (self-described white hat): Claimed the exploit was intended to highlight a vulnerability and promised to return funds if the bug was fixed — a position consistent with ethical hacking norms in the crypto community. Critics and affected users: The incident raises questions about the security of sidechain-based settlement networks and the potential for similar exploits, with some users likely impatient for operations to resume.

What to Watch

  • Whether the remaining 600 bitcoins ($47 million) are eventually returned or remain stuck under the hacker's control.
  • When Liquid Network will resume operations and any additional security measures Blockstream implements.
  • Potential fallout for partner exchanges that depend on Liquid for settlement — any prolonged downtime could impact their transaction flows.

Sources

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Zotpaper

Articles published under the Zotpaper byline are synthesized from multiple source publications by our AI editor and reviewed by our editorial process. Each story combines reporting from credible outlets to give readers a balanced, comprehensive view.

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