Bitcoin ETFs Clock Best Week in Flows Since April as Coldcard Hack Shakes Up Sentiment

Bitcoin exchange-traded funds just recorded their best week for inflows since April, pulling in roughly $1 billion in net new capital. The performance ranks as the third-strongest weekly inflow since the Silent IPO disrupted the market in October 2024.

Bloomberg ETF analyst Eric Balchunas flagged the development on X, noting that the inflows came despite (or perhaps because of) one of the most significant security incidents in Bitcoin’s recent history: the Coldcard hardware wallet hack.

The Coldcard Connection

Since the Coldcard hack began on July 30, a handful of major Bitcoin ETFs (including BlackRock’s IBIT, Fidelity’s FBTC, BITC, ARKB, and MSBT) have recorded net inflows for several straight sessions, totaling approximately $620 million in the immediate aftermath.

Balchunas described the timing as a “hard to ignore” correlation, though he stopped short of claiming a direct causal relationship.

“It would be ironic, yet somehow on brand, if the hack of BTC in cold storage (seemingly the worst possible scenario) marked the beginning of the next run,” Balchunas wrote.

The logic is straightforward: when a hardware wallet widely regarded as “unhackable” gets breached, investors may reconsider the risks of self-custody and rotate toward regulated, institutionally managed products like ETFs.

The Coldcard Hack in Numbers

The theft itself has been staggering. Hackers exploited a firmware vulnerability that weakened seed-phrase entropy for over five years, making private keys trivially brute-forceable.

Galaxy Research has confirmed 1,596 BTC stolen across roughly 7,300 addresses in three confirmed attack waves, with a suspected fourth wave potentially pushing losses toward 2,055 BTC.

The largest single theft involved 1,159 BTC, which has not moved since consolidation. A separate attacker has begun mixing approximately 64 BTC through Wasabi Wallet’s CoinJoin service. Estimates of total losses vary, with some reports placing the figure above $116 million.

Coldcard has released emergency firmware updates for all affected models. Users who generated seeds on vulnerable firmware are urged to move funds to fresh wallets immediately.

Bitcoin Holds Above $65K

Bitcoin is trading near $65,000 , up roughly 3.2% on the week. The advance followed a surprise contraction in U.S. jobs, which pushed traders to scale back Federal Reserve rate-hike bets.

However, crypto holders are not particularly happy. Gold and silver have outperformed crypto this week, with gold surging past $4,300 and silver reclaiming $58.

For Bitcoin, the immediate question is whether ETF inflows can continue. The $1 billion weekly figure is a strong signal of renewed institutional interest. But whether the Coldcard hack marks the beginning of the next rally or just a temporary rotation remains to be seen.

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