ColdCard Hack Spikes Small Bitcoin Transactions Amid Self-Custody Concerns
A significant surge in small Bitcoin transactions has been observed following the suspected ColdCard exploit. According to CryptoQuant, nearly 40,000 BTC were transferred on July 31, 2026, with most of these transactions being less than 1 BTC. This marks the largest daily movement by smaller holders since the collapse of FTX in November 2022.
CryptoQuant's Head of Research, Julio Moreno, noted that this spike in activity is a result of users taking action to secure their funds. The incident has become one of the largest failures of Bitcoin self-custody in recent years, with researchers estimating that about 1,367 BTC have been stolen from roughly 4,585 addresses worth nearly $89 million at current prices.
The suspected ColdCard exploit is believed to have unfolded across three coordinated waves. The vulnerability stems from a firmware flaw that generated predictable wallet seeds on affected ColdCard devices manufactured between 2021 and 2025. This allowed attackers to mathematically reconstruct private keys without physical access to the hardware wallet, making it a fundamentally different type of hardware wallet failure.