Blockstream Rejects Liquid Hackers’ Ransom Demand | Crypto Security News
Crypto security news: Blockstream Rejects Liquid Hackers’ Ransom Demand. This update explains what happened, why it matters for wallets, exchanges, traders, and users, and what the market should watch next.
Crypto Security Update
Bitcoin infrastructure company Blockstream said it will not pay a ransom to recover funds still held by the Liquid Network hackers.“Taking assets without authorization and withholding their return is a crime, not responsible disclosure,” Blockstream said Friday. “It is not white-hat activity. It is theft.”The company said it had engaged with the hackers in good faith to recover user funds but would not accept their demands. The hackers demanded that Blockstream pay a 10% bounty from its own funds in an onchain message shared by Jan3 CEO and former Blockstream chief strategy officer Samson Mow on Wednesday. They warned that Liquid holders would otherwise face a 15% loss.Blockstream urged the hackers to return the remaining Bitcoin voluntarily. If not, it said it would work with law enforcement, exchanges, service providers and forensic specialists to trace the assets and identify those responsible. On Sept. 6, Liquid, a Bitcoin sidechain, paused operations after self-described white-hat hackers withdrew about 4,000 Bitcoin, then worth about $320 million, from its federation wallet.The actors subsequently returned 3,400 BTC after Blockstream said that affected bridge nodes had been patched, leaving about 598 BTC outstanding.Liquid resumed block production on Thursday, producing empty blocks following emergency software updates. Transactions and Bitcoin transfers into and out of the network remained suspended.Related: ‘White hats’ take 4000 BTC from Liquid, ETFs see best inflows of 2026: Hodler’s DigestCointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.
Why This Security News Matters
First, this development may affect exchange safety, wallet security, user trust, and broader market sentiment. In addition, it may influence platform security practices, fund recovery efforts, and regulatory pressure. As a result, traders and crypto users should watch the next updates closely.
What To Watch Next
Watch for official statements, post-mortem reports, wallet warnings, exchange responses, and fund recovery updates. In particular, any new details about phishing, exploits, private key exposure, or security patches could directly affect the broader crypto market.
