Blockstream rejects ransom as Liquid hackers hold nearly 600 BTC

Blockstream has rejected a ransom demand from hackers who have stolen nearly 600 Bitcoin from the Liquid Network. The company stated that taking assets without authorization and withholding their return is a crime, not responsible disclosure, and thus not white-hat activity. Instead of paying a 10% bounty demanded by the hackers, Blockstream expressed its intent to collaborate with law enforcement, exchanges, forensic specialists, and service providers to trace the stolen assets and identify the responsible parties.

If the hackers fail to return the remaining Bitcoin voluntarily, Blockstream assured that it will take necessary legal actions to recover the stolen funds. Liquid, a Bitcoin sidechain, experienced a security breach on September 6 when hackers withdrew around 4,000 Bitcoin, worth approximately $320 million, from its federation wallet.

Following the hackers' return of 3,400 BTC after Blockstream confirmed that certain bridge nodes had been patched, 598 BTC remain unaccounted for. The network resumed block production on Thursday but with empty blocks, while transactions and Bitcoin transfers into and out of the network are still suspended.