According to The Block, the number of new Bitcoin addresses created last week jumped from roughly 260,000 to over 330,000, reversing a downward trend that had lasted through most of 2026. The climb followed a wallet migration set off by a Coldcard vulnerability. Since July 30, users of Coinkite hardware wallets have lost at least 1,816 BTC — around $116 million — in four waves of attacks. The vulnerability traces to a 2021 firmware defect: seed phrase generation used a software random number generator with weaker security instead of the device's hardware entropy source, allowing attackers to brute-force wallets created offline. The weak random number generator meant that wallets created offline were not protected by hardware-level randomness, making them feasible targets for offline brute-force attempts. Coinkite has recommended that anyone who generated wallets between March 2021 and the security patch release migrate to new wallets. The incident highlights the execution risks of self-custody, prompting users to weigh self-custody against alternatives such as centralized exchanges and Bitcoin ETFs.
Bitcoin's network activity picked up last week, with the number of new addresses created climbing from roughly 260,000 to more than 330,000, according to The Block. The increase broke a decline that had persisted for most of 2026 and came as holders began migrating wallets after a security issue in Coinkite's Coldcard hardware wallets.
Since July 30, Coinkite users have lost at least 1,816 BTC, worth about $116 million, in four separate waves of attacks. The root cause lies in a firmware defect from 2021: when the device generated seed phrases, it used a software random number generator with weak security instead of the hardware entropy source. That opened the door for attackers to brute-force wallets that had been generated offline.
Coinkite has told users who created wallets between March 2021 and the security patch release to move to new wallets. The episode serves as a reminder that self-custody carries real execution risk. Users are now comparing the security of holding assets directly with the convenience and protection of third-party custody services such as centralized exchanges or Bitcoin ETFs.
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