Bitcoin infrastructure company Blockstream said it will not pay a ransom to recover funds still held by the Liquid Network hackers.“Taking assets without authorization and withholding their return is a crime, not responsible disclosure,” Blockstream said Friday. “It is not white-hat activity. It is theft.”The company said it had engaged with the hackers in good faith to recover user funds but would not accept their demands. The hackers demanded that Blockstream pay a 10% bounty from its own funds in an onchain message shared by Jan3 CEO and former Blockstream chief strategy officer Samson Mow on Wednesday. They warned that Liquid holders would otherwise face a 15% loss.Blockstream urged the hackers to return the remaining Bitcoin voluntarily. If not, it said it would work with law enforcement, exchanges, service providers and forensic specialists to trace the assets and identify those responsible. On Sept. 6, Liquid, a Bitcoin sidechain, paused operations after self-described white-hat hackers withdrew about 4,000 Bitcoin, then worth about $320 million, from its federation wallet.The actors subsequently returned 3,400 BTC after Blockstream said that affected bridge nodes had been patched, leaving about 598 BTC outstanding.Liquid resumed block production on Thursday, producing empty blocks following emergency software updates. Transactions and Bitcoin transfers into and out of the network remained suspended.Related: ‘White hats’ take 4000 BTC from Liquid, ETFs see best inflows of 2026: Hodler’s DigestCointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

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A revised version of the CLARITY Act would direct United States regulators to determine whether people or groups controlling “non-decentralized finance trading protocols” must comply with securities, commodities and anti-money laundering (AML) requirements.The revised text, posted on Senator Cynthia Lummis’ website, defines such a protocol as one whose functionality, operation, or rules can be materially altered by a person or coordinated group. The definition also covers protocols whose controllers can restrict users or whose transactions are not governed solely by transparent, pre-established code.Under the proposal, the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) would develop activity-based rules addressing registration, conduct, disclosure, recordkeeping and supervision. Meanwhile, the Treasury would establish how existing Bank Secrecy Act obligations apply to affected controllers.The bill specifies that software and distributed ledger systems would not be required to register in their own capacity. It also says participation in an incident-response or security council would not, by itself, establish control over a protocol. The revised text arrived ahead of a procedural Senate vote scheduled for Sept. 15. The measure requires 60 votes to advance, meaning Republicans will need support from Democrats despite continuing disagreements over ethics, anti-money laundering protections and stablecoin rewards.Crypto industry backs bill as ethics dispute lingersIn a statement shared with Cointelegraph, Crypto Council for Innovation CEO Ji Hun Kim called Tuesday’s vote a “pivotal moment” for digital assets, innovation and American leadership. Kim told Cointelegraph that the US needs a framework combining consumer protections with business conduct standards.On Thursday, Coinbase CEO Brian Armstrong told CNBC that the CLARITY Act was “ready to get a yes vote.” He said the “must-have issues” previously raised by Coinbase had been resolved, while negotiations over ethics restrictions remained active and appeared close to a solution. Armstrong did not specify which provisions had changed.Related: Following Senate delay, crypto bill has narrow window to become lawDespite this, the ethics section in the newly released text remained largely unchanged from the previous version, despite being one of the main points of contention in negotiations. On Aug. 20, Democratic Senator Ruben Gallego warned against holding a vote before lawmakers resolved disputes involving ethics and stablecoin yield. “A fast vote gets you a fast result, but I’m not sure it’s the result you want,” Gallego said at the time.Armstrong said that if the legislation does not advance, the SEC and CFTC could instead pursue rulemaking and innovation exemptions using their existing authority.Magazine: 10 of the greatest unsolved crypto mysteries