The Liquid Network's Federation has fully restored the network's Bitcoin reserves, returning every L-BTC to 1:1 Bitcoin backing, the network announced in a November 2nd X post.

The shortfall had stood at 550 Bitcoin as of October 28th, after a 50-Bitcoin transfer to the Federation's wallet.

L-BTC is the token used on Liquid, a Bitcoin sidechain, and is designed to be redeemable one-for-one for Bitcoin held by the Federation.

The gap traced back to a September 6th exploit in which a flaw in Elements, Liquid's underlying software, allowed roughly 4,000 unbacked L-BTC to be redeemed for 3,996.02 Bitcoin, according to the Federation's incident assessment.

The party behind the exploit returned 3,400 Bitcoin to the Federation's wallet on September 7th at 16:09 UTC, the assessment recorded.

The Federation noted that swaps between Bitcoin and L-BTC were restored several weeks ago, letting users move between the two networks at a 1:1 rate through participating swap providers.

Users running their own Liquid nodes can verify the Federation's Proof of Reserves directly, and reserve balances are also tracked on a public dashboard at liquid.network, according to the post.

When checked on November 2nd, the dashboard listed 4,268.95 L-BTC in circulation against 4,268.95 Bitcoin in Federation holdings and labeled the network "Solvent."

JAN3 CEO and Liquid Network Technology Board member Samson Mow weighed in on November 2nd by quoting his own September 15th post, which stated, "the peg will be restored to 1:1."

His new post read simply, "I told you."

Looking ahead, the Federation outlined plans to modernize its governance structure, introduce clearer responsibilities and oversight, and add further technical and operational safeguards.

The Federation stated it will share more details on those initiatives and its next steps in the coming weeks.