A crypto investor has suffered a devastating loss of $6.9 million after unknowingly purchasing a compromised cold wallet through Douyin, the Chinese version of TikTok. Within hours of activating the device, the user’s digital assets were completely drained.
The Hidden Danger of Discount Cold Wallets
According to blockchain security firm SlowMist, the cold wallet’s private key was compromised at the time of manufacturing, allowing hackers to swiftly siphon off funds once the wallet was activated. Although the wallet was advertised as “factory sealed” and sold at a discounted price, it had been tampered with to trick unsuspecting buyers.
“These discounted wallets are often a trap. The cheap price is bait. The real cost is your crypto,” SlowMist warned.
Funds Disappeared Within Hours via Illicit Channels
The compromised wallet was reportedly used by a close contact of a former Bitmain team member known as Hella. The stolen crypto was quickly laundered via Huiwang, an illicit financial network operated by Huione Group, known for its involvement in darknet transactions and scam operations.
“The wallet was a carefully designed hot trap,” Hella shared on X, noting that the funds were gone within hours through untraceable channels.
“Don’t Gamble Your Life Savings on Cheap Devices”
SlowMist’s chief information security officer, known as 23pds, emphasized the critical takeaway:
“Never risk your entire fortune on a wallet that’s a few hundred bucks cheaper. That’s not saving—it’s losing everything.”
The officer also noted that many of these scams are hard to detect because the scam may not involve the seller directly, but rather third-party handlers who are unaware they’re distributing tampered goods.
More Attacks Targeting Wallet Security
This isn’t an isolated incident. In May, a Chinese printer manufacturer was accused of embedding crypto-stealing malware into drivers, stealing nearly $953,000 worth of Bitcoin. Earlier, thousands of counterfeit Android phones were found preloaded with malware designed to steal crypto, as revealed by cybersecurity firm Kaspersky.
Conclusion: Choose Your Crypto Wallet Wisely
As crypto adoption grows, so do scams targeting user security. Experts strongly advise purchasing cold wallets only from verified and official channels. A small discount can result in catastrophic losses, as this $6.9 million case tragically proves.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.