Liquid Restores Bitcoin Swaps, Peg-Outs Remain Frozen
Swaps Back, Withdrawals Still Blocked
Liquid, a cryptocurrency exchange, has restored the ability for users to swap Bitcoin using its proprietary token, L-BTC. Despite this update, the exchange has kept withdrawal limits in place, meaning users cannot exchange L-BTC back into actual Bitcoin on the main network, a process known as a peg-out.
The decision follows a period where security concerns led to restrictions. While internal trading features are now active, the primary exit route remains frozen.
Reserves Cover Most, But Not All, User Funds
- Reserves currently cover approximately 85.8% of the outstanding L-BTC tokens.
- There is a shortfall of roughly 603 Bitcoin.
- Swap functionality has been reinstated for users.
- Peg-out withdrawals to the main Bitcoin network remain disabled.
Why This Matters
The restoration of swaps allows users to continue trading within the Liquid platform. However, the frozen peg-outs mean that holders of L-BTC cannot fully recover their value in external Bitcoin until the reserve shortfall is resolved or a new timeline is announced. The 85.8% reserve ratio indicates that the majority of user funds are still secured, but the 14.2% gap explains why full liquidity has not yet returned.
Source
Newisty Editorial Team covers technology, cryptocurrency, digital products, online platforms, developer tools and the wider digital economy. Our content is researched from official sources, company announcements, public documentation, market data and other primary or reputable sources. Articles are reviewed and edited before publication for clarity, accuracy and useful context.