Blockstream rejects ransom, Liquid network still restricting peg-outs after exploit
Security & Exploits ·
Blockstream has refused a ransom demand tied to a Liquid Network exploit, even after the attacker returned the bulk of the stolen funds, leaving roughly 600 BTC unaccounted for.
The attacker returned 85% of the stolen bitcoin, but 598.5 BTC, worth an estimated $25 million, remains outstanding, according to The Block. The attacker had sought a bounty equal to 10% of the stolen funds in exchange for returning the rest, a demand Blockstream has rejected outright.
Blockstream said it will not pay the requested cut and will instead pursue recovery of the remaining bitcoin through legal channels, according to CryptoPotato. The company's stance signals it is treating the incident as a matter for law enforcement and legal proceedings rather than a negotiation with the attacker.
Liquid Network has resumed producing transactions and blocks following the exploit, but peg-outs remain disabled while recovery work continues, a restriction confirmed across coverage of the incident, including reporting from WuBlockchain. Keeping peg-outs frozen limits the ability to move assets off the network even as basic transaction processing has returned to normal, suggesting Blockstream is still working to fully secure the system or trace the remaining funds before restoring full functionality.
The episode has drawn coverage from multiple outlets, all describing the same core sequence: an exploit, a partial return of funds, a rejected ransom demand for the remainder, and a network still operating under partial restrictions. What remains unresolved is whether the 598.5 BTC will be recovered through the legal action Blockstream has signaled, when peg-outs might be restored, and what technical or procedural changes to Liquid Network's security may follow once recovery efforts conclude.