Elements bug sends 4,000 BTC out of Liquid's reserve, 3,400 returned

What happened

Liquid acknowledged a roughly 4,000 BTC withdrawal, valued at about $320m at the time. Blockstream established that the L-BTC used for the peg-out was created through an Elements bug. On 7 September, 3,400 BTC returned to the federation address; the return transaction sent 598.49955894 BTC back to the actor. The dollar figure here is the initial gross withdrawal estimate, before recovery.

The return confirmed at 16:09:25 UTC on 7 September in block 965,950, restoring roughly 85% of the approximately 4,000 BTC headline amount, and a subsequent 8 September transaction retained 598.49988609 BTC at the actor’s address. The actor demanded a 10% payment for the retained coins in an on-chain message, and on 11 September Blockstream refused it, calling the theft a crime and committing to every lawful avenue of recovery. Liquid block production resumed on 10 September, with transaction processing following and peg-outs still suspended. Blockstream’s status page carried the incident as open on 19 September. The Exploit Tracker’s $320m entry is gross incident value, not a $320m outstanding loss.