Liquid Network Recovers 3,400 BTC After On Chain Talks

A group of friendly hackers who withdrew nearly 4,000 bitcoin from the Liquid Network federation wallet over the weekend returned 3,400 BTC on Monday. About 15 percent of the total, or 598.5 BTC, stayed with the holders as a finder fee worth roughly 48 million dollars. The transaction was confirmed following a day of public messages written directly into Bitcoin blocks using data fields.

The talks began when the hackers published a message asking for contact. A Blockstream linked address answered with a security email address and later used PGP signatures to verify its identity. The hackers asked if returning most of the funds was acceptable, and urged the team to fix an underlying bug before the final transfer. Once Blockstream confirmed that bridge nodes were patched, the large return transaction took place.

While recovering 85 percent of the funds avoided a total disaster for the platform, the size of the payout caused friction. The retained 598.5 BTC equals a huge sum at current market rates, and subsequent encrypted messages suggest that private negotiations over the fee grew tense. Observers will monitor whether Blockstream or the hackers release more details about the remaining dispute.