The initiative promises to reward 10% of any recovered funds, capped at 3 BTC, after hackers compromised LND credentials and emptied merchant Lightning wallets last week.
By Shaurya Malwa46 min ago2 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on BTCPay announces $190,000 bounty following exploit of bitcoin payment servers. (Unsplash)SummaryShow- BTCPay Server is offering a reward of 10% of any recovered bitcoin, capped at 3 BTC, to individuals who provide information leading to the recovery of the funds, including the hacker.
- The incident arose from a security flaw that enabled attackers to acquire LND Lightning node credentials and drain the associated wallets, impacting merchants like Foundation and Citadel21.
- BTCPay has engaged exchanges, blockchain forensic firms, and law enforcement to assist in tracking the stolen funds, while advising merchants to report their losses and store their assets securely.
- The vulnerability was identified by researchers from the volunteer Bitcoin Red Team, who are utilizing AI technology to identify bugs in bitcoin projects, and BTCPay is rewarding them with BTC donations.
BTCPay Server announced on Tuesday that it is offering a bounty for the return of bitcoin stolen from merchants last week, pledging to pay 10% of any recovered amount, with a maximum limit of 3 BTC, equivalent to around $190,000 based on current market values.
The offer is extended to anyone with pertinent information, including the attacker, and the organization has invited individuals to contact its security address, assuring that secure communication channels are available upon request.
If multiple reports contribute to the recovery, the bounty will be distributed among the victims based on their individual losses and the significance of the information provided.
We're donating 0.21 BTC to @craigraw and 0.21 BTC to the Bitcoin Red Team for their responsible security disclosure of the recent critical vulnerability.
— BTCPay Server (@BtcpayServer) August 10, 2026
In addition, friends and supporters of the BTCPay Server project have committed to funding a bounty to recover the stolen… pic.twitter.com/qhs8zwoCvM
Additionally, the project is rewarding the researchers who identified the flaw with a donation of 0.21 BTC each to developer Craig Raw and the Bitcoin Red Team fund.
Last week, hackers exploited the vulnerability to gain access to LND credentials, a software commonly used for Lightning node operations, and proceeded to drain the linked wallets.
Merchants such as hardware wallet manufacturer Foundation and the bitcoin publication Citadel21 have reported losses, although the total amount has not yet been disclosed by either BTCPay or the affected parties.
In a separate announcement, BTCPay mentioned that various exchanges, blockchain analytics firms, and law enforcement agencies have offered assistance in tracking the stolen funds. They also urged affected merchants to notify local authorities and any services tied to the funds' tracking.
The Bitcoin Red Team is a volunteer initiative that commenced using AI models to analyze bitcoin codebases this month and has reported thousands of findings across numerous projects, including the discovery that led to this patch.
In the meantime, BTCPay advised merchants to store their funds in cold wallets and to regularly transfer surplus funds from hot wallets, particularly during this period of swift, AI-driven changes.
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