Coldcard Warns Users of Potential Risk After Massive Bitcoin Fund Drain

Coldcard Mk3 users have been warned of a potential risk to their Bitcoin funds after an automated operation swept 594 BTC from 500 single-signature addresses. The affected devices generated seeds with only 72 bits of entropy, rather than the expected 128 bits.

The issue affects every Coldcard Mk3 firmware release since version 4.0.1 in March 2021 and is linked to device-generated entropy used when creating seeds.

Users are advised to migrate their funds to a newly generated seed on an unaffected device, while those with affected devices should first upgrade to the latest firmware before generating a replacement seed.