Blockstream has drawn a firm line against the party holding the Bitcoin taken from the Liquid Network and has stated that it will not pay a ransom for the return of the stolen funds.
In its latest statement, Adam Back-led blockchain tech company rejected the claim that the incident qualifies as responsible disclosure, while arguing that taking assets without authorization and then withholding them is theft, not white-hat activity.
“Transactions Do Not Disappear”
Blockstream said it had engaged in good faith to recover the stolen user funds, but added that those efforts should not be taken as acceptance of the hackers’ actions or their demands. While rejecting the demand for a bounty, the company said it would not set a precedent where open-source developers are forced to pay a ransom over software built for the Bitcoin community.
“Bitcoin is hard money and can’t be minted without costs; Bitcoin doesn’t haircut users to pay a ransom.”
Blockstream said there was still an opportunity for those holding the stolen BTC to return it and resolve the situation responsibly. If the funds are not returned, however, the company would pursue every lawful avenue available, including working with law enforcement, exchanges, service providers, and forensic specialists to trace the assets and identify those responsible. It also stressed that Bitcoin transactions remain visible by design, meaning the funds and the evidence associated with their movement do not simply disappear.
No Easy Way Out
The hackers had previously called Blockstream “delusional, greedy, and arrogant” over its handling of security. Samson Mow later warned that they may be underestimating the consequences of their actions. The former CSO of Blockstream said that the company’s willingness to communicate with them through PGP was already a courtesy and questioned whether publicly admitting to taking the assets and then demanding a bounty was a wise move. He also said the group had left behind more clues than it might realize.
The incident began on September 6, when roughly 4,000 BTC was withdrawn from Liquid’s Federation wallet. The alleged white-hat hackers later returned 3,400 units, while about 598 remained in their possession.
Meanwhile, Liquid has now entered another recovery phase. Block production and transactions have resumed, although peg-outs remain disabled. The network said internal and external teams are continuing testing, AI-assisted code scanning, and monitoring, while Liquid node operators have been told to update to Elements v23.3.4.
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