Samson Mow Discusses Blockstream Liquid Network Adoption
Blockstream CSO Samson Mow presents on Liquid Network adoption among cryptocurrency exchanges and trading firms for faster Bitcoin settlement.
On November 8, 2018, Samson Mow, Chief Strategy Officer of Blockstream, discussed growing adoption of the Liquid Network, a Bitcoin sidechain enabling faster settlement and enhanced privacy for cryptocurrency exchanges and trading firms. Liquid represented an alternative scaling approach to Lightning Network, targeting institutional rather than consumer use cases.
The Liquid Network was a federated sidechain allowing participating exchanges and brokerages to move Bitcoin between institutions nearly instantly rather than waiting for on-chain confirmations. Assets on Liquid, called L-BTC, were backed one-to-one by Bitcoin locked in the sidechain's multi-signature federation.
For exchanges, Liquid offered several benefits: near-instant settlement between member exchanges enabled more efficient arbitrage and market making, enhanced privacy through confidential transactions obscured amounts being transferred, and reduced on-chain fees by conducting multiple trades off-chain before final settlement.
Liquid's federated model—where predefined trusted entities controlled the sidechain rather than permissionless miners—represented a different security trade-off than Bitcoin's base layer or Lightning Network, sacrificing full decentralization for performance and privacy in contexts where participants had established trust relationships.
Mow's discussions addressed Liquid's adoption progress, with multiple major exchanges including Bitfinex, BitMEX, and others joining the federation. For Bitcoin's scaling ecosystem, Liquid represented recognition that different use cases required different solutions: consumer payments might use Lightning Network, while institutional settlement could use Liquid, and long-term storage remained on Bitcoin's base layer.
Critics noted that Liquid's federation model introduced trust assumptions absent from base-layer Bitcoin, questioning whether this qualified as true Bitcoin scaling. However, proponents argued that Liquid provided practical solutions for institutional needs while maintaining Bitcoin backing and enabling eventual settlement to the main chain.Liquid's development during 2018's bear market showed that Bitcoin infrastructure innovation continued across multiple approaches simultaneously.