Hackers Begin Laundering Stolen Coldcard Bitcoin Through Crypto Mixers

The Coldcard wallet hackers have reportedly started moving some of the stolen Bitcoin. This marks the latest development in the unfolding Coldcard hardware wallet hack, which resulted in a loss of about 1,800 BTCs. Although the attackers have already moved a small portion of the funds through crypto mixers to hide their trail, most of the BTC is still untouched.

Notably, the Coldcard wallet hack is considered one of the largest hardware wallet security incidents in recent years. As the event has once again sparked concerns about hardware wallet security, investigators are closely watching potential developments. Crypto exchanges and law enforcement agencies have already flagged hundreds of addresses.

Coldcard wallet hackers move stolen Bitcoin

As more developments unfold in the Coldcard wallet hack, the latest update is about the stolen funds. Reports reveal that the hackers have transferred a small portion of the stolen Bitcoin via crypto mixers. This is a method often adopted by illegal players to conceal their funds and their trail.

Reportedly, the Coldcard wallet hackers had stolen nearly 1,800 BTC, worth around $130 million. Out of these coins, the hackers have now moved about 64 BTC, while the majority of the coins, more than 1,100, still remain across the hacker’s seven wallets.

As of now, the investigators have identified about 600 wallet addresses, possibly linked to the Coldcard wallet hacker. These addresses have been thus flagged by crypto exchanges and law enforcement agencies as they continue to monitor the stolen funds.

How did the Coldcard hack occur?

Significantly, the Coldcard wallet hack occurred due to a flaw in older versions of the wallet’s software. In simple terms, the bug affected the way in which some devices generated their recovery seed phrases. Instead of creating these seed phrases with a highly secure random process, some wallets used a weaker method that made them vulnerable.

Thus, the hackers exploited this vulnerability and they have been able to steal between 1,596 and 2,055 BTC so far. According to developers investigating the attack, the hackers executed the attack in multiple waves. Within the first hour itself, a large portion of Bitcoin was stolen. Soon, the hackers stole the rest of the funds.

Following the Coldcard wallet hack, the company shared an X post that read:

“The last three days have been some of the hardest in this company’s history, and for a lot of the people reading this, they’ve been something much worse. Money that took years to save, gone. Trust that took years to build, broken. That impact is real, and for some, the damage is permanent. Some are asking hard questions about our company. We are, too.”

Further, the company stated that it has destroyed all remaining Coldcard wallets made with vulnerable firmware. The team has also stopped shipping these affected devices. They further assured that Satscard, Opendime, and Tapsigner products were not affected by the vulnerability.

Source:: Hackers Begin Laundering Stolen Coldcard Bitcoin Through Crypto Mixers