Liquid Network
Also: Liquid
lightning · advanced
A federated Bitcoin sidechain operated by ~15 exchanges and businesses. Faster blocks, confidential transactions, asset issuance.
Liquid (Blockstream, 2018) is a sidechain pegged to BTC. Users deposit BTC into a federation-controlled multisig on mainchain; they receive L-BTC on the sidechain in return. The sidechain has 1-minute blocks, deterministic 2-block finality, confidential-transaction amounts, and supports issuing arbitrary tokens (used for security tokens, stablecoins like USDt-Liquid).
The trust model is the federation — currently ~15 exchanges, custodians, and infrastructure firms. A supermajority of them would have to collude to steal funds. Withdrawal back to mainnet is processed via a daily federation-signed transaction.
Liquid is best understood as a settlement layer for institutions that need confidentiality and faster finality than Bitcoin offers, but want Bitcoin underneath rather than running their own chain. Retail use exists but is dwarfed by Lightning. The federation model means Liquid is not "trustless Bitcoin" in the sense main chain is.