# Blockstream Deposits 300 BTC Into Liquid Federation Wallet, Lifting Backing to 94.14%

> Blockstream moved 300 BTC into the Liquid Federation wallet on November 2, 2026, cutting the reserve shortfall to 250 BTC.

- Published: 2026-11-02T22:49:50+00:00
- Section: Incidents
- Author: News Desk
- URL: https://newsforagent.com/news/2026-11-02/blockstream-liquid-300-btc-deposit
- Source: [Crypto Briefing](https://cryptobriefing.com/blockstream-300-btc-liquid-shortfall-250/)

## Key takeaways

- Blockstream transferred 300 BTC into the Liquid Federation wallet on November 2, 2026, reducing the reserve shortfall to 250 BTC.
- The federation wallet now holds 4,018.95 BTC against 4,268.95 L-BTC in circulation, a 94.14% backing ratio.
- Peg-out redemptions remain frozen until every L-BTC is matched by real Bitcoin.
- A September 6, 2026 exploit of Elements software drained approximately 4,000 BTC, and about 3,400 BTC was later returned.

Blockstream transferred 300 BTC into the Liquid Federation wallet on November 2, 2026, cutting the network's reserve shortfall to 250 BTC. [Crypto Briefing](https://cryptobriefing.com/blockstream-300-btc-liquid-shortfall-250/) reported the deposit lifts the federation wallet to a 94.14% backing ratio. Peg-out redemptions remain frozen until every L-BTC is matched by real Bitcoin.

## Inside the 300 BTC Liquid Deposit

The transfer landed on November 2, 2026. Before it arrived, the gap between issued L-BTC and the Bitcoin held in reserve stood at approximately 550 BTC. After the deposit, the federation wallet holds 4,018.95 BTC while 4,268.95 L-BTC remains in circulation, a backing ratio of 94.14%.

The deposit follows a test transaction of roughly 2.53 BTC on October 27, 2026, part of the gradual effort to restore reserves. The trouble started on September 6, 2026, when attackers exploited vulnerabilities in Elements, the software underpinning the Liquid Network, and pulled out approximately 4,000 BTC. Approximately 3,400 BTC was returned to the network, leaving an estimated 600 BTC hole.

[Blockstream](https://akta.pro/company-profiles/00002t6/blockstream), led by CEO Adam Back, pledged to cover the remaining shortfall internally rather than pass the losses on to users. External security audits were completed by October 20, 2026, and the company rolled out software upgrades and changed how keys are managed.

## Blockstream's Funding and Partnership Record

According to akta.pro [company records](https://akta.pro/company-data), Blockstream was founded in 2014 and is headquartered in Menlo Park, with total funding of $632 million at the Series B stage and a last round dated October 15, 2024. The same records list a $210 million Series B in August 2021 led by Baillie Gifford and Bitfinex, a $125 million convertible note and loan financing in January 2023 led by Kingsway Capital, and a $210 million convertible note in October 2024 led by Fulgur Ventures. The records also show a June 2026 partnership with Intercontinental Exchange to launch a cryptocurrency data service covering over 100 cryptocurrencies and 35 trading venues.

## How the Liquid Shortfall Built Up

On September 6, 2026, Bitcoin Magazine reported that purported white-hat hackers withdrew about 4,000 BTC, worth roughly $320 million, from the Liquid Network federation wallet backing L-BTC, and that bridge nodes were disabled and the sidechain paused. On September 7, 2026, Bitcoin reported that Blockstream paused the Liquid network after roughly 4,000 BTC, worth $320 million, was withdrawn, with exchanges told to halt L-BTC deposits and withdrawals. On September 9, 2026, Bitcoin reported that hackers demanded a 10% bug bounty while holding 598.5 BTC and threatened a 15% loss to holders if refused.

## What Comes After the 250 BTC Gap

L-BTC holders currently cannot redeem their tokens for native Bitcoin because peg-outs remain halted until the network reaches 100% reserve backing. The remaining step is Blockstream's deposit of the final 250 BTC, after which the peg-out restart would let holders test the recovery.

## Companies in this story

- [Blockstream company profile](https://akta.pro/company-profiles/00002t6/blockstream) · website: https://blockstream.com

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