Bitcoin’s Liquid Network reports a $320 million hack as a Tether-backed exchange folds

The Bitcoin-based Liquid Network says $320 million was withdrawn in a hack¹. The figure was reported consistently across outlets, as US$320mil stolen in the latest crypto hack², as $320 million withdrawn⁴, and as a $320 million hack against the network⁵. Italian coverage framed the same amount as stolen from the Liquid Network and asked what the implications are for investors³.

Users of the network included Tether, the world’s largest stablecoin issuer, and BitMEX, which has announced it is shutting down this month². Reporting on the incident ran alongside unrelated items in the same news cycle, including preparations for mid-September AI safety talks between the US and China¹.

The second failure

Orionx, a Santiago-based crypto trading exchange backed by Tether, announced on September 3 that it is shutting down after an audit discovered a shortfall⁸. The exchange halted withdrawals and closed following a $7 million custody shortfall, having taken backing from Tether about 15 months earlier⁷. Tether had framed the original investment as part of a push to expand stablecoin access across Latin America⁹.

One newsletter assessment put the failure in proportion while drawing a conclusion from it: the $7 million custody gap, though small relative to Tether’s reserves, underscores the operational risk embedded in equity stakes that do not come with control⁶.

Why it matters to investors

Both events are infrastructure failures rather than price events. One is a sidechain of the largest crypto network reporting a nine-figure unauthorised withdrawal^1,4; the other is an exchange closing after an audit found money missing^7,8. Neither turned on the direction of any token.

The sequence is also close together. The exchange announced its closure on September 3 after an audit found the gap⁸, and the network hack was reported in the days that followed¹. In both cases the loss surfaced through a review or a withdrawal record rather than through a market move^4,7.

The context is a stablecoin sector that has grown quickly. Total stablecoin market capitalisation has grown by 154.8% in five years, with Ethereum hosting $163.5B of a rebounding $300B market, and regulatory scrutiny of Tether is increasing¹⁰. That is the same issuer named as a Liquid Network user² and as the backer of the exchange that has now closed^7,9. Custody arrangements, rather than headline market size, are where these losses appeared⁶.