Coldcard Security Notice Puts Bitcoin Wallet Entropy Risk Back In Focus

A Coldcard security issue has put Bitcoin hardware-wallet safety back under the microscope after reports that a firmware flaw affected seed generation on some older device versions.

According to the validated incident notes, the issue relates to Coldcard Mk3 firmware versions 4.0.1 through 5.0.3, along with Mk4 and Mk5 devices before firmware 5.6.0, and Q devices before 1.5.0Q. The core problem was a seed-generation weakness in which a hardware random number generator was replaced by a predictable software substitute, reducing entropy from the intended 128 bits to 72 bits.

That is a technical detail, but it matters enormously. A Bitcoin wallet is only as safe as the seed phrase behind it. If seed generation becomes predictable enough for an attacker to narrow the search space, the wallet can become vulnerable even if the user never shared their phrase, clicked a phishing link, or exposed a private key.

The reported sweep involved roughly 594 BTC from around 500 single-signature wallets on July 30 and 31, 2026.

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