Blockstream Refuses Bounty Demand After Liquid Network Hack

On September 6, 2026, almost 4,000 BTC vanished from reserves linked to Blockstream’s Liquid Network. The group responsible announced on‑chain that they were acting as “white‑hats” and began communicating with Blockstream via OP_RETURN messages embedded in tiny Bitcoin transactions.

Partial Return and Bounty Demand

After a series of public and encrypted exchanges, the attackers sent back roughly 3,400 BTC, leaving about 598.5 BTC still in their control. Instead of returning the remainder, the group demanded a 10% bounty paid from Blockstream’s own funds and warned that refusal could cause Liquid (L‑BTC) holders to suffer a 15% loss.

Blockstream’s Response

Blockstream publicly stated that it will not pay any ransom or bounty, describing the act as theft rather than responsible disclosure. The company emphasized that Bitcoin is “hard money” and that users should not be forced to absorb a payout to the attackers. Blockstream also announced that, if the remaining BTC are not returned, it will cooperate with law‑enforcement agencies, exchanges, and blockchain forensic specialists to trace and recover the funds.

Competing Claims About Prior Disclosure

Bitcoin Red Team co‑lead Calle claimed his team had warned Blockstream about the vulnerability before the exploit, suggesting the loss cost “600 BTC to ignore an email.” Former Blockstream Chief Security Officer Samson Mow disputed this, saying no such email was ignored. Both sides indicated they would publish further details after Blockstream releases a post‑mortem.

Reputational Impact

The incident has sparked criticism on social media, with users questioning Blockstream’s code quality and its handling of the disclosure. Some commentators argued that the company’s refusal to negotiate could set a precedent for how future on‑chain vulnerability disclosures are treated.

Next Steps

Blockstream’s stated plan is to pursue the remaining 598.5 BTC through forensic tracing and cooperation with relevant authorities, underscoring that Bitcoin’s public ledger makes it difficult for large sums to disappear unnoticed.