Bitcoin Red Team Claims Blockstream Ignored Warnings Before Hack

• Bitcoin Red Team claims Blockstream received security warnings before the Liquid exploit.
• An attacker removed 4,000 BTC from Liquid federation reserves before returning 3,400 BTC.
• Adam Back linked the exploit to an incorrect fix for a separate vulnerability.

Blockstream rejected a payment demand after an attacker removed 4,000 BTC from Liquid’s federation reserves. The company called the withdrawal theft and requested 598.5 BTC held by the attacker.

The attacker returned 3,400 BTC after on-chain discussions. However, it withheld the balance while seeking a 10% bounty. Blockstream said it “will not pay a ransom for the return of stolen funds.”

Calle Says Blockstream Received an Earlier Warning

Bitcoin Red Team co-lead Calle connected the unpaid balance to a security report sent before the Sept. 6 exploit. “Turns out it only costs you 600 BTC to ignore …

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