Blockstream declines ransom demand from Liquid Network hackers, network resumes block production
Security & Exploits ·
The company says it will pursue legal recovery instead of paying a 10% bounty sought by attackers who stole bitcoin from the Liquid sidechain.
Blockstream confirmed that blocks on the Liquid Network have resumed after the theft, according to cryptopotato.com, which reported the company rejected the hackers' 10% bounty demand outright. Rather than negotiate a payout, Blockstream said it intends to pursue recovery through legal channels.
The refusal marks a break from the pattern in some past crypto exploits, where projects have negotiated bounty terms with attackers in exchange for returning most of the stolen funds. By publicly ruling out payment, Blockstream signals it is treating the incident as a criminal matter to be resolved through law enforcement or civil action rather than through direct settlement with the perpetrators.
The exploit adds to a run of security incidents across the bitcoin ecosystem. Bitcoin Depot separately disclosed a $3.6 million BTC theft from corporate wallets in an SEC filing, made roughly two weeks after the breach occurred. In a related but unconnected case, Ostium reported an offchain breach that drained $23.75 million from its OLP vault using false BTC price reports. Onchain activity tied to the Lazarus Group also showed a transfer of 121.5 BTC, worth $7.74 million, moved in a single transaction.
Specifics of the Liquid Network breach, including the total amount of bitcoin stolen and how the attackers gained access, have not been detailed. It is also not yet clear what legal avenues Blockstream plans to pursue or whether any funds have been recovered or frozen since blocks resumed. Whether the hackers will attempt further contact or leak stolen funds onto exchanges remains to be seen, as does any formal law enforcement involvement in the case.