Microsoft has also partnered with security companies, domain name providers, academia, internet companies such as AOL and others on a co-ordinated global response to the worm.
Also included is the US Department of Justice and the Department of Homeland Security.
"The best way to defeat potential botnets like Conficker/Downadup is by the security and Domain Name System communities working together," said Greg Rattray, chief internet security adviser at the Internet Corporation for Assigned Names and Numbers (Icann).
Sasser worm
In 2003 Microsoft created its reward programme with $5m (£3.4m) in funding to help law enforcement agencies bring computer virus and worm authors to justice.
"We have not seen this type of worm or one of its class since 2004," said Mr Stathakopulos.
In 2005 Microsoft paid out $250,000 (£171,000) to two individuals who helped identify the creator of the notorious Sasser worm. The author was arrested and sentenced by the German authorities.