MarketsColdcard Breach Prompts Security Reevaluation in Self-Custody: Insights from Cory Klippsten
A five-year-old firmware vulnerability was revealed during the attack, leading to an industry shift toward collaborative multisig security.
By James Van Straten|Edited by Sheldon Reback Aug 5, 2026, 9:55 a.m. 2 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on
Cory Klippsten (Swan Bitcoin)Summary:- Cory Klippsten, CEO of Swan, noted that the Coldcard incident led many bitcoin holders to reconsider their custody methods.
- He mobilized his team to assist users in securing their assets, even reaching out to those not affiliated with Swan.
- Instead of abandoning self-custody, users are opting for vaults that mitigate the risk posed by compromised devices.
During a wedding in Paris, Cory Klippsten began receiving urgent messages regarding the Coldcard incident.
"It was a brutal weekend for so many who lost bitcoin," Klippsten shared in an interview. "I was up at 4 a.m. helping someone on Pacific Time secure their coins."
The alarming events unfolded last Thursday when hackers exploited a previously unnoticed firmware flaw in Coldcard hardware wallets, leading to significant bitcoin theft.
A vulnerability in a March 2021 firmware update for the Coinkite wallet rendered users' private keys less secure than intended. By the time three waves of attacks occurred, approximately 1,600 BTC, worth over $100 million, had been siphoned from around 7,300 addresses, as per Galaxy Research.
Swan, a U.S.-based platform assisting individuals in buying and self-custodying bitcoin, temporarily halted withdrawals for clients at risk, issued in-app alerts, and extended support to anyone needing assistance.
"Our team prioritized contacting clients and then opened up help to anyone in need, regardless of their association with Swan," Klippsten explained.
A week later, nearly 90% of the stolen bitcoins remain untouched on-chain, with confirmed attacker addresses reported to U.S. federal authorities. Coinkite has since patched all affected devices. Additionally, a volunteer group backed by OpenSats examined over 150 open-source repositories and found no signs that the issue was widespread beyond Coldcard.
This incident has prompted some industry voices to question the reliability of self-custody, suggesting that investors might be better off purchasing bitcoin through exchange-traded funds instead of holding it themselves.
Klippsten, however, believes that clients are not moving away from self-custody but are instead seeking ways to enhance the security of their bitcoin holdings.
"People are transitioning to Swan Vault right now," he stated, referring to the firm's collaborative multisig solution, which ensures that no single device can compromise a user's funds. "Rather than abandoning self-custody, many are choosing to upgrade it."
His overall sentiment about the situation is cautiously optimistic.
"It’s unfortunate that people lost their coins, especially since they followed the best practices recommended by many experts in the field. However, Bitcoin is resilient, and the tools to safeguard it are evolving rapidly. This incident could ultimately prove to be a pivotal moment for self-custody."
Bitcoin NewsCustodyLatest Crypto News- 1Why bitcoin’s ‘500-day rule’ faces its biggest test yet55 minutes ago
- 2Live updates: An AI credit bubble could set up bitcoin’s path to $1 million1 hour ago
- 3The worst chart for bitcoin bulls right now2 hours ago
- 4New Ethereum proposal would cut issuance to zero if staked ETH reaches $112 billion4 hours ago
- 5"You stole, please return some." Coldcard hacker's wallet becomes a graffiti wall of pleas and hustles4 hours ago
- 6Bitcoin flat at $64,000 as stocks print records and Hormuz deal nears5 hours ago
- 7SpaceX tops Wall Street revenue forecast, posts $540 million loss on bitcoin holdings13 hours ago
- 8Open USD rattled Circle's stock, but its key backers still support USDC16 hours ago
- 9Samsung is poised to become a dominant stablecoin distributor, analysts say16 hours ago
- 10Clarity Act sits idle over Trump ethics question as Warren asks SEC to investigate him17 hours ago
The Evolution of the Crypto CEX Landscape: A Case Study on Binance
The Evolution of the Crypto CEX Landscape: A Case Study on Binance
Binance remains crypto’s leading exchange, expanding from spot and derivatives into RWAs, payments, savings, yield, and broader financial services.
By CoinDesk ResearchJun 29, 2026Commissioned byBinanceBinance remains crypto’s leading exchange, expanding from spot and derivatives into RWAs, payments, savings, yield, and broader financial services.
Why it matters:
Binance remains crypto’s leading exchange, expanding from spot and derivatives into RWAs, payments, savings, yield, and broader financial services.
View Full ReportMore From Markets