Coldcard Hack Reignites Custody Debate Amid Record-Breaking Bitcoin ETF Inflows

A high-profile hack of the Coldcard wallet has reignited debate over digital asset security and custody, but it hasn't deterred institutional investors from pouring money into Bitcoin ETFs. This week saw $211.5 million in net inflows to spot Bitcoin ETFs, with BlackRock's IBIT leading the charge with $111 million on Monday and $170 million on Tuesday.

Fidelity's FBTC also attracted significant attention, adding about $33 million and $20 million across the two sessions. The Coldcard hack is estimated to have affected around 7,300 addresses and resulted in approximately $130 million in suspected Bitcoin losses.

Bloomberg Intelligence analyst Eric Balchunas said the hack may accelerate migration toward Bitcoin ETFs as investors reassess the trade-offs between institutional custodians and smaller crypto companies. He noted that features once viewed skeptically could now be seen as advantages.