Bitcoin News

Story: Coldcard Firmware Flaw Drains 1,367 Bitcoin Across 4,585 Wallets

By Pankaj K

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Coinkite's AI Review Missed What Attackers Found. Coinkite, the company that makes Coldcard, ran an AI-based review of its own firmware and didn't…

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Self-Custody's Foundational Promise Under Pressure. Hardware wallets exist for one reason: to keep your Bitcoin safe without trusting a third party.

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A trusted name in Bitcoin security just took a serious hit. Coldcard, the hardware wallet brand widely favored by self-custody advocates, is at the center of a breach that has…

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The root cause goes back further than most people realize. A firmware update shipped in March 2021 quietly introduced a weak software fallback for generating wallet seeds.

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Galaxy Research has tracked three distinct attack waves so far. They've flagged roughly 600 suspect addresses to federal investigators and warned that a fourth wave is probably…

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Coinkite, the company that makes Coldcard, ran an AI-based review of its own firmware and didn't catch the vulnerability. The attackers apparently did.

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Coinkite hasn't hidden from the problem. The company acknowledged the breach and the failure of its own AI review. No spin, at least publicly.

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Galaxy has been clear that all vulnerable Coldcard devices remain at risk of being fully drained.

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Related: Bitcoin Drops to $63,350 as Coldcard Exploit Wipes $88.6 Million Across 4,585 Wallets

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The breach doesn't just hurt Coldcard's brand. It rattles something more fundamental. If a wallet that never connected to the internet can be drained because of a firmware flaw…

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The crypto industry has spent years arguing that self-custody is safer than leaving funds on exchanges.

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There's also a broader question here about AI's role in security — on both sides of the fight. Defenders are using it to audit code.

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More context: Coldcard Firmware Flaw Puts 448.7 Bitcoin at Risk as Second Wave Hits 709 Wallets

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For now, Galaxy Research is pushing affected users to move funds immediately if they haven't already.

The Currency Analytics

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