The dispute between Blockstream and the party claiming to be a white hat hacker has taken a sharper turn, according to the latest update from Samson Mow.
The hacker accused Blockstream of serious security flaws, while claiming the company allocated only $1.5 million, if anything, to secure $5 billion in assets.
New shock with Blockstream
Calling it a “gross negligence in security,” the hackers demanded that Blockstream pay a 10% bug bounty from its own funds and warned that failure to do so could result in a 15% loss for Liquid users.
The message also accused Blockstream for being “delusional, greedy and arrogant” in its handling of security. The hackers further stated that they plan to later release the private key needed to decrypt their conversations.
Meanwhile, Liquid has kept the sidechain on pause while Blockstream and Federation members work on further security fixes, resolve a chain split, and prepare for a coordinated restart. Users have also been asked not to send Bitcoin to Liquid login addresses until the network is back online.
The latest post comes after around 4,000 BTC, worth around $320 million at the time, was withdrawn from Liquid’s Federation wallet on September 6. The party behind the withdrawal initially claimed to be hackers and said the funds would be returned once Blockstream resolved the security issue and patched all affected nodes. After Blockstream confirmed that the bridge nodes had been patched, 3,400 BTC was returned to the Federation wallet, while around 598 units remained with the hackers.
Future consequences
Mow, in a separate tweet, warned to hackers that they may underestimate the consequences of their actions. He said Blockstream’s decision to communicate with them via PGP was already a “courtesy” and questioned whether publicly admitting to taking BTC and then demanding a premium was really a “wise decision.”
Blockstream’s former chief strategy officer also suggested the group left more clues than they realized and cautioned that trying to return the funds doesn’t necessarily mean they can just walk away from the incident.
“As a white hat, the road only gets wider; as a black hat, you’re always on edge. Dreaming of walking away with assets unscathed is just an illusion. Some doors, once opened, can never be closed again.”
The article Liquid Hackers Calls Blockstream “Delusional, Greedy, and Arrogant” and Demands a 10% Bounty appeared first on CryptoPotato.