₿ Crypto

594 BTC Drained in 25 Minutes as Hardware Wallet Flaw Exposes Seeds

Attackers leveraged a randomness flaw in a major Bitcoin hardware wallet to drain 594 BTC—worth $38 million—in a 25-minute sweep, exploiting predictable seed phrases to bypass security.

📅 July 31, 2026 🕐 1 min read

1 assets impacted (Crypto). Net bias: 0 Bullish, 1 Bearish, 0 Neutral. Strongest signal: BTC/USD ↓ 7/10 (80% confidence).

📊 Affected Assets (1)

BTC/USD

Bearish 🤖 80%

📅 Short-term 🌍 Global · Explicit

A hardware wallet randomness bug enabled attackers to guess seed phrases, draining 594 BTC in a rapid sweep. The theft erodes trust in the security of crypto custody solutions, potentially triggering short-term sell pressure on Bitcoin as users question wallet integrity.

Catalysts

▼ Hardware wallet randomness vulnerability exploited
▼ 594 BTC drained in 25-minute automated sweep

Risk Factors

▲ Vulnerability limited to a specific wallet model, avoiding systemic contagion
▲ Funds may be recovered or insured, mitigating market panic

▼ Show FAQ (2) ▲ Hide FAQ

Should investors move Bitcoin off this hardware wallet?

Yes, if you use the affected wallet model, immediately transfer funds to a secure wallet with robust seed generation. Monitor manufacturer announcements for firmware updates or patches.

Could this flaw affect the Bitcoin network itself?

No, the flaw is isolated to a specific hardware wallet's seed generation process, not the Bitcoin blockchain or protocol. Bitcoin's consensus and security remain intact.

🎯 Key Takeaways

A randomness bug in a hardware wallet's seed generation made seed phrases guessable by attackers.
594 BTC, valued at $38 million, were drained in just 25 minutes in an automated sweep.
The exploit targeted the wallet's flawed random number generator, undermining the security model of 'impossible to guess' seeds.
The incident exposes critical risks in crypto custody, even for hardware solutions marketed as cold storage.
Users of the affected wallet model face immediate risk and should transfer funds to secure alternatives.
The rapid execution of the theft indicates sophisticated, automated exploitation of the known vulnerability.
The breach raises broader concerns about the audit and certification processes for crypto hardware wallets.

📝 Executive Summary

A hardware wallet randomness bug turned “impossible to guess” seeds into guessable ones, and $38 million is already gone.

❓ FAQ

What caused the loss of 594 BTC?

A randomness flaw in a major hardware wallet's seed generation algorithm allowed attackers to guess private keys, enabling them to drain 594 BTC from affected wallets in a rapid sweep.

Which hardware wallet was affected?

The article does not disclose the specific brand or model of the hardware wallet, only describing it as a 'major' device with a randomness bug in seed generation.

What is the broader implication for crypto security?

The theft demonstrates that even hardware wallets, considered the gold standard for cold storage, can have devastating vulnerabilities if seed generation relies on insufficient entropy, prompting a re-evaluation of custody practices across the industry.

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