Blockstream rejects ransom as Liquid hackers hold nearly 600 BTC
Reported by Cointelegraph · AI-assisted summary by ChikoCorp AI News Desk
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Summary
Bitcoin infrastructure company Blockstream refused to pay a ransom to recover nearly 600 BTC still held by hackers of the Liquid Network. The hackers, who initially withdrew about 4,000 BTC from Liquid's federation wallet, demanded a 10% bounty from Blockstream, warning Liquid holders of a potential 15% loss. Blockstream engaged with the hackers in good faith but labeled their actions as theft and vowed to work with authorities to recover the funds.
Why it matters
Blockstream's rejection of ransom highlights the company's stance against paying hackers, potentially influencing security practices and responses to crypto thefts. The situation affects Liquid Network operations, which remain partially suspended with transactions halted despite resume of block production, impacting users and liquidity.
Key context
On September 6, Liquid Network paused operations after the unauthorized withdrawal of approximately 4,000 BTC, valued at about $320 million at the time. Hackers returned 3,400 BTC following patches to affected bridge nodes, leaving about 598 BTC outstanding. Liquid resumed block production on empty blocks, but full transaction functionality is still suspended.
Key numbers and entities
Blockstream, Liquid Network, Jan3 CEO and former Blockstream chief strategy officer Samson Mow, approximately 4,000 BTC withdrawn, 3,400 BTC returned, about 598 BTC still held by hackers, $320 million approximate value at withdrawal.
What remains unclear
The source does not disclose the identities of the hackers, the specific demands beyond the 10% bounty, or the exact timeline and methods Blockstream will use to collaborate with law enforcement and other entities to recover the remaining funds. It also does not explain when full transactions might resume on the Liquid Network.