Bitcoin layer-2 network Liquid Network halted all user transactions after its system detected withdrawals totaling nearly 4,000 BTC, worth approximately $320 million. The massive withdrawal immediately forced network operators to step in and suspend core operational systems.
Although block production has resumed, core network functionalities remain offline. All regular user transactions remain fully frozen for an indefinite period.
Ransom Rejected Following Reserve Drain
Recent reports indicate that 95% of the total Bitcoin reserves held on Liquid Network have vanished from the system. Blockstream, one of the network’s key entities, responded by rejecting a ransom demand from the hacker, who currently controls 598 BTC - roughly $47 million worth of the stolen funds.
On the regulatory front, the CLARITY Act faces fresh uncertainty ahead of a scheduled US Senate vote on September 15. The proposed legislation has now swelled into a 630-page revised draft.
Hundreds of Pages of Compromise Without Breakthrough
The voluminous revision includes 100 demands from Senate Democrats, incorporated to secure their support during the legislative process. However, as of mid-month, formal backing from the party has yet to materialize.
Inflation Checks Price Momentum
Bitcoin initially showed strong momentum, touching $79,837 earlier in the week. That price level nearly pushed the chart to form a golden cross on the 50-day Exponential Moving Average (EMA) line, a technical pattern that often triggers follow-through buying.
That upward momentum stalled once US inflation data was released. The August Consumer Price Index (CPI) held steady at 3.4% year-over-year, matching July’s figure, while core CPI came in at 2.4%.
The stubborn inflation figures triggered a sell-off ahead of the Federal Reserve meeting on September 15-16. US spot Bitcoin ETFs recorded net outflows of $462.7 million across four consecutive trading sessions between September 8 and 11.
Next week’s Fed meeting now serves as the key determinant of market direction, as technical support and regulatory optimism have failed to provide market certainty.
Source: crypto.news.
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Previously: 95% of Reserves Vanish - Liquid Network Resumes Block Production but User Transactions Remain Frozen
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
