Blockstream Rejects Ransom Demand in Liquid Network Exploit

Blockstream has rejected a ransom demand from attackers who exploited a vulnerability in the Liquid Network to steal an estimated 598.5 BTC, worth around $12 million at current prices.

The exploit, which occurred on September 6th, saw approximately 4,000 unbacked L-BTC converted into BTC through Liquid's standard peg-out process.

Liquid reported that the attackers returned 3,400 BTC to the Liquid Federation peg wallet on September 7th, leaving around 15% of the stolen funds outstanding.

Blockstream characterized the actions as 'theft,' stating that paying a ransom would set a precedent for developers of open-source Bitcoin software facing demands exceeding their economic participation.