Concerns are growing in the cryptocurrency sector regarding a security vulnerability discovered in hardware wallets. Galaxy Research, the research unit of Galaxy Digital, has warned that the total loss caused by the security flaw found in Coldcard hardware wallets could exceed 2,000 Bitcoin. The potential loss could be approximately 2,055 BTC, or over $130 million at current prices.
An analysis published by Galaxy Research states that a total of 1,596 BTC was stolen as a result of three major attacks and 14 smaller security incidents confirmed to date. According to the research, these attacks affected approximately 7,300 different Bitcoin addresses.
Experts stated that the security vulnerability stems from a flaw in the random number generation mechanism used in Coldcard devices. The flaw reportedly affects specific firmware versions used in Coldcard Mk3, Mk4, Mk5, and Coldcard Q models.
Coinkite, the manufacturer of the devices, released an urgent software update after the security vulnerability was discovered and advised users to update their devices as soon as possible.
Galaxy Research stated that there is strong evidence suggesting a fourth attack, not yet fully confirmed, was carried out using the same method. If this incident is also included in the total, the amount of Bitcoin stolen could reach 2,055 BTC.
The investigative team also stated that they have been working in coordination with federal investigative agencies and various cryptocurrency exchanges in the US following the incident. The aim was stated as identifying the attackers and closely monitoring the movements of the stolen assets.
Another striking detail in the report was that a large portion of the stolen funds had not yet been moved. According to Galaxy Research data, approximately 90% of the stolen Bitcoin is still being held at the addresses where it was originally located. Analysts suggest this could mean the attackers have not yet begun laundering or selling the funds.
*This is not investment advice.
Continue Reading: Alarming Coldcard Announcement from Galaxy Research! Wallet Losses Could Exceed 2000 BTC: Here Are the Details