Hardware wallet bug drains $38M in 25 minutes

A confirmed randomness flaw in a major hardware wallet device allowed attackers to reconstruct private key seeds algorithmically. The vulnerability was in the wallet's random number generator (RNG), the component responsible for producing the entropy that makes a seed phrase unique and unguessable. When RNG output is weak or predictable, seeds generated by that device can be derived by anyone who knows the flaw and has enough computational resources.

Attackers exploited this to sweep 594 BTC, worth approximately $38 million, across affected wallets in 25 minutes. The speed indicates an automated, pre-staged attack: the derivation work was almost certainly done offline in advance, and the on-chain movement was a single coordinated drain once targets were identified.

The specific device model has not been confirmed in available reporting, but CoinDesk's coverage confirms this is a real, completed exploit, not a theoretical disclosure.

Hardware wallets carry an implicit trust assumption: the seed was generated securely at setup, and physical possession of the device is the only attack surface. This exploit breaks that assumption at the root. It means wallets that were never connected to the internet, never exposed to malware, and never physically compromised could still be drained, because the seed itself was weak from birth.