Galaxy's research team has revised upward its estimate of Bitcoin losses tied to a Coldcard security vulnerability, putting the total at approximately $70 million. The updated figure significantly exceeds earlier assessments and draws renewed attention to custody risks associated with self-managed hardware wallets—devices that Bitcoin holders typically adopt precisely because they are considered more secure than exchange custody or software wallets.

According to The Block, the losses are linked to a flaw in Coldcard's seed generation process. Galaxy's research arm also published its findings on its X account.

Revised Estimate Reflects Broader Exposure

The core development is that Galaxy reassessed the scale of the reported losses, arriving at the higher $70 million figure rather than reaffirming a prior estimate. The upward revision indicates the firm factored in additional exposure when recalculating the total.

While the available reporting supports the revised number and its attribution to Galaxy, the exact methodology, timeline, and wallet mechanics behind the recalculation have not been publicly detailed. The precise difference between the earlier and latest figures remains unclear, and further clarification may be needed before the estimate can be treated as final.

The underlying issue traces to seed generation on Coldcard hardware. A seed phrase—a series of words that serves as the master key to a wallet—is the foundation of self-custody: if the seed itself is generated insecurely, no amount of offline storage or device-level security can protect the funds. Coinkite, the company behind Coldcard, addressed the matter in an official seed generation warning, which serves as the primary source on the wallet behavior at issue.

Custody-Risk Implications

A loss estimate at this scale elevates concerns around hardware wallet security for Bitcoin holders managing their own keys. The revision suggests the exposure is broad enough to merit closer scrutiny of seed generation and key management practices across the self-custody ecosystem—an area that has grown in prominence as exchange failures and hacks have pushed more users toward holding their own private keys.

Galaxy has been active on Bitcoin security more broadly. The firm previously launched a $5 million Bitcoin security fund and a separate Bitcoin quantum initiative, both reflecting a sustained focus on protecting Bitcoin holdings from technical failure modes.

For those following the incident, the key facts are narrow: the estimated loss has grown, the figure comes from Galaxy's research team, and the underlying cause has been acknowledged by the wallet manufacturer. Coldcard users concerned about potential exposure should consult the manufacturer's guidance and the resources linked above. Additional detail on how the total was calculated remains outstanding.