Bitcoin held a tight range through the weekend even as thieves kept draining Coldcard hardware wallets and a rival BIP-110 chain quickly stalled after splitting off. The scare triggered the busiest week of new wallet creation in a year.
Bitcoin traded between $64,500 and $65,250 over the past 48 hours, changing hands around $64,800 to $64,900 on Sunday morning, Aug. 9, even as a hardware-wallet exploit and a live minority-chain split both hit the network.
Coldcard Sweeps Push Losses Toward $133 Million
A firmware flaw introduced in March 2021 weakened the randomness used to generate some Coldcard wallet seeds, leaving some devices open to offline attacks capable of reconstructing private keys. Attacks began July 30, and the first major wave drained roughly 594 to 1,196 BTC from more than 1,100 addresses in less than an hour. Subsequent thefts pushed high-confidence loss estimates to roughly 1,596 to 1,719 BTC, while suspected activity could raise the total to about 2,055 BTC, worth roughly $133 million at prevailing prices.
Coinkite released patched firmware and told affected users to generate new seeds and move funds, since an update alone cannot repair an already-compromised seed. By Sunday evening, Galaxy's Alex Thorn was tracking a likely fourth organized wave of attacks, and the largest drained address so far held 51 BTC.
Wallet Creation Hits a 12-Month High
2.27 million new Bitcoin wallets were created in the week ending Aug. 8, the highest weekly total in 12 months, alongside 751,000 active wallets, the strongest level of network activity in 10 months, according to on-chain analytics firm Santiment. Santiment identified the Coldcard vulnerability as the catalyst, as holders followed the standard playbook after a suspected compromise: generate a fresh wallet, sweep funds to it, and sort out the rest later. Santiment added that such spikes don't necessarily signal weakness in the Bitcoin network itself and have often preceded upward price moves historically.
BIP-110 Fork Collapses Almost Immediately
BIP-110 fared worse. The proposal needed a 55% miner-signaling threshold that support never approached, hovering near 2.53% in the final signaling period.
When enforcement began around block 961632, nodes rejecting non-signaling blocks split off a minority chain that mined two BIP-110 blocks before stalling, while Bitcoin's dominant chain kept adding blocks. The minority branch inherited Bitcoin's full mining difficulty despite holding a tiny sliver of hash power, and by Aug. 9, roughly 99.85% of hash power remained with the main chain.
Self-Custody Debate Reignites
The thefts revived debate over self-custody. According to Mert Mumtaz: "self-custody is the entire point of crypto." Meanwhile, analyst Eric Balchunas noted U.S. spot Bitcoin ETFs have seen inflows every day since the hack, totaling $620 million.
Momentum indicators pointed to indecision Sunday: the 14-period relative strength index hovered around 53 to 55, a neutral reading. Immediate support sits around $64,000 to $64,500, with resistance clustered near $65,000 to $65,500.
Traders are watching whether a sustained move above $65,500 to $66,000 opens the door toward $67,000 to $69,000, or a break below $64,000 puts $62,000 to $63,000 back in play.
Sources: Bitcoin News, Crypto Briefing, Bitcoin News
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