In an X post, Liquid Network said: " We are aware of a security incident on

@Liquid_BTC. Purported white-hat hackers have withdrawn ~4,000 BTC (~$320 million) from the Liquid Federation wallet. The @Blockstream team is working on contacting them on-chain with a signed message."

The firm,which develops a blockchain designed for faster transactions, further said the funds were withdrawn via the SideSwap PAK (Peg-out Authorization Key), but that key was not compromised, nor were any others.

" Exchanges have been notified and have already paused (or will pause) LBTC deposits and withdrawals. Other Liquid assets such as USDT, DePix, and RWAs are unaffected by this security incident," the X post said.

"The firm said bridge nodes have been temporarily disabled, so no new transactions can be submitted to the network," the post further said.

The X post mentioned: "Effectively, the Liquid sidechain is paused until this issue is resolved. Liquid wallets will be impacted, and we're sorry for any inconvenience. Federation members are actively working on resolving this so we can restore normal network activity."