Bitcoin holders move funds to exchanges after $89 million Coldcard exploit
The recent Coldcard hack has resulted in investors moving their bitcoin holdings to exchanges for safety. This is a reversal of the trend seen after the FTX collapse in late 2022, where investors withdrew coins from centralized platforms.
The Coldcard vulnerability has raised questions about the security of hardware wallets and self-custody. Daily exchange deposits of Bitcoin transfers under 10 BTC spiked to 7.3K BTC, the highest since February 6.
This on-chain flow is the opposite of the large withdrawals seen after FTX’s collapse in late 2022. Security issues in the crypto market often push investors in predictable directions, with the Coldcard hack being the latest example, with $90 million in potential losses, exceeding the initial $70 estimate, and affecting 89 million potential users.