$89M Coldcard Hack Sparks Reversal of Post-FTX Bitcoin Behavior
A $89 million hack targeting Coldcard hardware wallets has shaken confidence in self-custody solutions. The breach exploited a five-year-old firmware vulnerability, allowing an attacker to remotely drain 1,367 BTC from over 4,500 addresses without physical access to the devices. This incident marks one of the largest thefts from non-exchange-held Bitcoin and has led on-chain data analysts like CryptoQuant to observe increased movement of small amounts of Bitcoin back onto exchanges—a reversal of post-FTX behavior where users moved funds off platforms for greater control. The hack highlights a growing debate in the crypto space. While Casa CEO Nick Neuman emphasized that self-custody remains far more secure than exchange custody, Bloomberg's Eric Balchunas argued that regulated solutions like ETFs with segregated cold storage offer safer exposure to Bitcoin without custodial risks. The event underscores both the strengths and vulnerabilities of different approaches to holding cryptocurrency.
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Topics: Bitcoin Coldcard hack crypto security hardware wallets