Canadian-based Bitcoin sidechain Liquid Network is having difficulty validating transactions on its network.

The Blockstream-owned multichain solution announced via Twitter that there was an issue with the network, and they were working to resolve it.

A subsequent tweet identified the problem from the block signing of transactions on the network. The culprit was said to be a recent “functionary upgrade.” However, the firm assured users that their funds were unaffected and safe.

Block signing is a digital signature used by blockchain protocols to validate the correctness of a transaction before adding it to the network. Difficulties signing blocks mean that many transactions will be pending and stored in a temporary shed on-chain.

A look at the network’s mempool – a pool where all valid transactions are piled before being confirmed on the Bitcoin network – shows that transactions are slowly filling up the chamber, waiting for the sidechain to process them.

This event has seen the network’s users question if the network’s recent upgrade prompted the issue.

In a September 29 tweet, the Bitcoin layer-two protocol launched its hard fork for Liquid BTC (L-BTC), named DynaFed or Dynamic Federations.

The hardfork is expected to introduce extensive features to the Bitcoin network and improve key areas around decentralization, security, and network flexibility.

Liquid node users were advised to upgrade to Element v0.8.1.11 or newer versions to access the new upgrade.

Blockstream was formed in 2018 by Adam Back and a few developers who set out to solve the scalability issues surrounding Bitcoin. This led to the development of the Liquid Network, which is reputed to reach block finality within two minutes while ensuring faster and more secure transactions on the Bitcoin network.

Although facing competition from the Lightning Network, another layer-two protocol, Liquid Network, has been favored by traders and exchanges for its fast block finalization window and private transaction settlements.

The Liquid Network uses an entirely different consensus algorithm from the Bitcoin network as it favors functionaries. These functionaries are similar to validators and enable the proposal and signing of blocks to be added to the sidechain. The DynaFed upgrade was meant to streamline this process by allowing the addition and removal of functionaries without adversely impacting network operations.

Meanwhile, the Liquid Network has continued to rack up integrations. The latest is security token issuance platform Stokr which recently partnered with the Bitcoin sidechain. In a release, the securities firm announced that users will now be able to access tokenized digital securities as investment vehicles. The Liquid Network is expected to play a critical role in facilitating the tokenization of Bitcoin.

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