Bitcoin News
By Sakamoto Nashi
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What happened. An attacker cracked it. Weak seed generation baked into certain Coldcard hardware wallet firmware…
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The historical context. It's not the first time a security assumption turned out to be wrong in a very expensive way. Mt.
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Why it matters. For Coinkite, the company behind Coldcard, the technical problem is probably the easier half of…
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What to watch. A few things worth tracking as this plays out.
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An attacker cracked it. Weak seed generation baked into certain Coldcard hardware wallet firmware let someone drain bitcoin from a large number of accounts — tens of millions of…
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The flaw wasn't some exotic zero-day. It traced back to a software-library migration in 2021 that quietly defaulted to a weaker randomness generator during wallet seed creation.
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It's not the first time a security assumption turned out to be wrong in a very expensive way. Mt. Gox collapsed in 2014 after security failures led to the loss of 850,000 bitcoin.
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The Coldcard situation fits that pattern uncomfortably well. Users did what they were supposed to do. They bought a reputable hardware wallet.
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For Coinkite, the company behind Coldcard, the technical problem is probably the easier half of what they're dealing with. Patching firmware is hard, but it's solvable.
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More context: Coldcards Flawed Firmware Put 1,082 Bitcoin at Risk, Block Warns
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There's also the communication problem. Coinkite's policy purges customer records after 120 days.
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And for users who didn't know any of this was happening — they're now tasked with verifying whether their wallet was affected and migrating to new wallets carefully, without…
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The users who came through unscathed, per available information, were largely those who added independent entropy — dice rolls, for instance — or used strong BIP-39 passphrases…
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Adoption of Coldcard's new firmware updates matters. A fast, widespread uptake would at least show that the existing user base is engaged and taking steps to address the exposure.
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See also: Strategy Posts $8.2 Billion Q2 Loss While Adding 11% More Bitcoin
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