The covenant sealed with blood most likely refers to the sacrifice involving blood that confirmed the Mosaic covenant (the agreement God made with Israel at Mount Sinai, Exodus 24:8).
The prisoners were Jews still living as exiles in Mesopotamia after the exile in Babylon. The Jews who stayed in Persia and Babylon were spiritual exiles because they lived outside the promised land of spiritual blessing and rest (see Deuteronomy 12:10). One of the Messiah’s key roles would be to free prisoners (Isaiah 61:1; Luke 4:17–22; Romans 7:6; Ephesians 4:8).