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      Blockstream Refuses Ransom Demand Following Liquid Network Exploit

      Blockstream announced on September 11, 2026, that it will not comply with a ransom demand related to a recent exploit on the Liquid Network, which resulted in the theft of bitcoin. The incident, reported on September 8, revealed that the perpetrators had returned 3,400 BTC, leaving approximately 598.5 BTC still unaccounted for.

      The exploit, which occurred on September 6, involved the creation of around 4,000 L-BTC that were not backed by actual bitcoin in the network's reserves. The attackers converted this unbacked L-BTC into BTC through Liquid's standard peg-out process. Blockstream clarified that the exploit did not compromise any private keys but targeted how nodes running the open-source Elements software processed range-proof verifications.

      In response to the situation, Blockstream stated that the actions of the individuals involved do not constitute responsible disclosure but rather theft. The company emphasized that paying the ransom would set a dangerous precedent for developers of open-source Bitcoin software. Liquid has since resumed block production and transactions as of September 10, but the peg-out feature remains disabled while recovery efforts continue.

      © 2026 KLEA News. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

      Source: KLEA News

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