Galaxy

Bitcoin

A fourth wave of coordinated sweeps against Coldcard-generated Bitcoin addresses struck on Monday, with Galaxy Research head <a href="https://x.com/intangiblecoins" rel="noopener noreferrer nofollow">@intangiblecoins</a> flagging roughly 449 <a href="https://x.com/search?q=%24BTC&amp;src=cashtag_click" rel="noopener noreferrer nofollow">$BTC</a> pulled from 709 likely victim addresses. <cite>Researchers now estimate the attacker has moved about 1,816 $BTC, or roughly $114 million, from more than 5,200 addresses since July 30.</cite><h2 id="how-the-attack-unfolded">How the Attack Unfolded</h2><cite>The attack began on July 30 in a sweep that took 1,083 $BTC from 1,196 addresses in just 41 minutes. Two further waves over the weekend brought observed losses to 1,367 $BTC across 4,585 addresses.</cite> The fourth wave extended that damage further, with <a href="https://x.com/intangiblecoins" rel="noopener noreferrer nofollow">@intangiblecoins</a><cite>noting the activity averaged 13.8 sweeps per block, around 45 times the rate observed in a pre-incident control window.</cite>The root cause is a firmware flaw introduced years ago. <cite>The vulnerability, introduced in Coldcard firmware 4.0.0 in March 2021, caused devices to skip their hardware randomness generator and fall back to predictable software-based key generation seeded by nonsecret chip data.</cite> That made supposedly unguessable seed phrases computationally reproducible, <cite>allowing attackers to reconstruct private keys without ever touching the devices.</cite><cite>The pattern suggests the flaw affects single-key Coldcard seeds and not multisignature setups.</cite><cite>Drained holdings had sat dormant for an average of 3.18 years, suggesting most victims were long-term holders rather than institutions.</cite><h2 id="a-narrow-window-for-victims">A Narrow Window for Victims</h2>The fourth wave carries an unusual, if time-sensitive, lifeline. <cite>Unlike earlier waves, the latest transactions appear to use Bitcoin's replace-by-fee feature, meaning victims who spot their coins in the mempool may still be able to outbid the attacker and move their funds first.</cite><cite>Alex Thorn, head of firmwide research at Galaxy Research, flagged the active wave and said the attackers opted into replace-by-fee, a Bitcoin feature that lets a pending transaction be overwritten by a later one paying a higher fee. Until a transaction confirms, a victim who finds their address in the mempool can pay more and move the coins out first.</cite><cite>Coldcard manufacturer Coinkite released emergency firmware for every affected model and told users who had generated a seed on the flawed software to move funds to a wallet address made with a fresh one.</cite><cite>Coinkite has warned users who created seeds on Mk3 devices running firmware 4.0.1 or later, while stressing that Mk4, Q and Mk5 appear unaffected so far.</cite> Critically, <cite>fixed firmware protects newly generated seeds, but existing vulnerable seeds still require complete wallet migration.</cite><cite>Galaxy said it has flagged roughly 600 suspected attacker addresses to federal investigators, compliance firms and cross-industry cyber investigators.</cite> Anyone holding $BTC on a potentially affected Coldcard device is urged to check the mempool immediately and migrate funds using high fees.Sources: <a href="https://www.coindesk.com/tech/2026/08/03/coldcard-wallet-losses-may-near-usd114-million-as-possible-fourth-sweep-emerges" rel="noopener noreferrer nofollow">CoinDesk: Bitcoin cold-wallet losses may near $114 million as possible fourth sweep emerges</a> <a href="https://crypto.news/coldcard-losses-rise-as-fourth-attack-wave-sweeps-448-btc/" rel="noopener noreferrer nofollow">Crypto.news: Coldcard losses rise as fourth attack wave sweeps 448 BTC</a> <a href="https://thehackernews.com/2026/08/coldcard-hardware-wallet-flaw-linked-to.html" rel="noopener noreferrer nofollow">The Hacker News: Coldcard Hardware Wallet Flaw Linked to Bitcoin Theft</a>

Coldcard losses near $114M as fourth attack wave hits

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