Binance founder Changpeng Zhao said Bitcoin holders should diversify their holdings across multiple wallets on Aug. 1 following a major hardware-wallet exploit [3].
The warning comes after a breach of Coldcard wallets, which are designed to be air-gapped for maximum security. This event suggests that even the most isolated storage methods remain vulnerable to sophisticated attacks.
Estimates of the total financial damage vary. Galaxy Research said the total loss is roughly $70 million [1], while the Blockonomi editorial team said losses hit $88.6 million [2].
Zhao, known as CZ, said no single security method is infallible. "Nothing is 100% safe," Zhao said [4].
The Coldcard exploit targeted hardware wallets used by Bitcoin holders worldwide [5]. These devices are intended to keep private keys offline to prevent remote hacking, a security feature known as air-gapping [6].
Zhao said multi-wallet security is the most prudent path forward for investors. By spreading assets across different platforms and hardware providers, users can reduce the risk of losing their entire portfolio to a single point of failure [7].
The incident has sparked a wider debate within the cryptocurrency community regarding the perceived safety of hardware wallets. While these devices are marketed as the gold standard for self-custody, the recent drain of tens of millions of dollars highlights a critical gap in current security assumptions [8].
“"Nothing is 100% safe."”
The Coldcard exploit challenges the long-held industry belief that air-gapped hardware wallets provide absolute security. This event likely accelerates a shift toward 'multi-sig' or diversified custody strategies, moving the user base away from reliance on a single device regardless of its technical specifications.
