Coldcard Hack Fuels Surge in Regulated ETF Inflows

A recent hack of Coldcard wallets has led to investors withdrawing their funds from self-custody and moving them into regulated exchange-traded funds (ETFs). The total loss due to the hack exceeds $116 million, with 1,800 BTC stolen.

The code used in the firmware released by CoinKite in 2021 contained a technical flaw that allowed hackers to calculate private keys and drain thousands of addresses. This vulnerability was not detected by the company's AI review just before the hack was discovered.

As a result, U.S. spot Bitcoin ETFs have seen a surge in net inflows, with $620 million pouring into funds such as IBIT and FBTC over just a few days. Eric Balchunas, Bloomberg's senior ETF analyst, notes that this trend is not surprising given the current market situation.