Coldcard Firmware Flaw Exposes $70 Million in Bitcoin

A security flaw in Coldcard's firmware allowed an attacker to drain over $70 million from 1,196 Bitcoin addresses in just 41 minutes. The affected devices were Coldcard hardware wallets made by Canadian company Coinkite, which are considered secure because they never connect to the internet.

The issue arose when a configuration file contained a zero value for MICROPY_HW_ENABLE_RNG parameter, which was supposed to disable MicroPython's built-in random number generator. However, the libngu library only checked if the parameter existed, not its value. This meant that every draw went through Yasmarang, a non-cryptographic pseudo-random number generator.

For five years, devices such as Mk3, Mk4, and Q had reduced unpredictability, ranging from 40 to 72 bits. This made it possible for the attacker to generate candidate seeds on their own machine and compare them against the blockchain to find matching addresses.