Bull Bitcoin’s self-custodial Bull Wallet has switched its full payment stack back on, restoring Lightning and Liquid transactions weeks after an exploit on the Liquid Network froze redemptions across the ecosystem.
Users can again send and receive Lightning payments in Bull Wallet, send and receive Liquid transactions, move bitcoin on-chain, and convert L-BTC back into on-chain bitcoin. Liquid payments have also resumed on Bull Exchange, the company’s trading platform.
The disruption began in September, when attackers exploited a vulnerability in Elements, the software that powers the Liquid sidechain. The flaw let them create more than 4,000 L-BTC that were never backed by bitcoin and exchange them for real bitcoin held by the Liquid Federation, draining nearly 4,000 BTC.
The attackers later returned about 3,400 BTC but kept 598.5 BTC, demanding a 10 percent bounty that Blockstream, the company behind Liquid, refused to pay. With the network’s bitcoin backing down to about 86 percent, the Federation suspended peg-outs, the redemption of L-BTC for bitcoin, while an independent security audit of Elements ran. 
On October 20, the Liquid Federation said the recovery had entered its final stages. Swaps between bitcoin and L-BTC are restored, running semi-automated for Federation members, and the final phase will re-establish full 1:1 backing before peg-outs are reactivated in a controlled rollout for authorized key holders.
Bull Wallet’s comeback is one of the first signs of that recovery reaching everyday users. The wallet launched worldwide on iOS and Android with self-custody at its core, letting users hold their own keys across on-chain, Liquid, and Lightning balances.
The episode also underlines how the layers differ. Liquid balances sat frozen while the Federation rebuilt its reserves, but Lightning payments never depended on those reserves, one reason wallets keep treating Lightning as the resilient rail for everyday payments. Our explainer breaks down how Bitcoin’s layer-2 networks interact.
