Liquid Network

Flows Like A Stream

The Liquid Network is a layer two (side-chain) developed by Blockstream which is built on top of Bitcoin’s mainchain. It is aimed primarily at traders and exchanges to allow faster settlement in 2 minutes, rather than 10 minutes on Bitcoin’s mainchain, whilst also providing more privacy and confidential transactions. 

Other digital assets can be added to the liquid network to make the most of these benefits but the confidential transactions means that large buy or sell orders can’t be front-run as this information is kept private.

L-BTC

To use the liquid network, you need to get liquid BTC (L-BTC) either from a third party or by running your own Liquid node via a process called “peg-in”. 

Bitcoin from the main chain is pegged 1:1 with L-BTC but in order to “peg-out” i.e. convert your L-BTC back to Bitcoin on the mainchain, you can only do this via one of the Liquid Federation members or through a 3rd party that supports exchanging L-BTC to BTC.

It’s very important to be aware that you need to have a way to convert L-BTC to BTC before you peg-in so bear that in mind if you want to get involved with the Liquid Network.

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