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<p>The Liquid Federation has deposited 50 BTC to begin restoring full backing for LBTC.

But here's the problem: Liquid transactions are confidential. Neither the amounts nor the types of assets transferred are publicly visible. So even after the reserves are replenished, we can't independently verify that every LBTC is backed by a real bitcoin.

If attackers managed to mint 4,000 unbacked LBTC, how can we know they didn't mint more?

That's the fundamental weakness of confidential blockchains: where transparency is missing, verification gives way to trust.</p>

The Liquid Federation has deposited 50 BTC to begin restoring full backing for LBTC.
But here's the problem: Liquid transactions are confidential. Neither the amounts nor the types of assets transferred are publicly visible. So even after the reserves are replenished, we can't independently verify that every LBTC is backed by a real bitcoin.
If attackers managed to mint 4,000 unbacked LBTC, how can we know they didn't mint more?
That's the fundamental weakness of confidential blockchains: where 

The Liquid Federation has deposited 50 BTC to begin restoring full backing for LBTC. But here's the problem: Liquid transactions are confidential. Neither the amounts nor the types of assets transferred are publicly visible. So even after the reserves are replenished, we can't independently verify that every LBTC is backed by a real bitcoin. If attackers managed to mint 4,000 unbacked LBTC, how can we know they didn't mint more? That's the fundamental weakness of confidential blockchains: where transparency is missing, verification gives way to trust.

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