Coldcard, the hardware wallet maker owned by Coinkite, has suspended its automatic customer data-blanking policy following a July 30 security incident, citing legal obligations to preserve records relevant to ongoing litigation. Customers can request an exemption to have their data deleted despite the hold.
The suspension marks a shift in Coldcard's stated privacy stance. The firm previously offered automatic deletion of user records after 90 days of inactivity as a privacy feature. The July 30 incident exploited a firmware vulnerability that compromised between $89 million and $130 million in Bitcoin, according to reporting on the breach.
A post on X by Coinkite confirmed the suspension on August 6, six days after the incident. Coinkite cited the need to preserve records for what it called ongoing and anticipated legal proceedings without naming any specific lawsuit or plaintiff. The company said customers who want their data blanked despite the legal hold can submit individual requests for exemption.
Coldcard is a single-signature hardware wallet that costs between $120 and $200. The July 30 vulnerability affected firmware versions spanning roughly five years, according to security researchers who examined the flaw. The compromise exposed private keys stored on affected devices, allowing attackers to transfer funds without the owner's knowledge or physical access to the hardware.
Legal holds are standard practice in litigation: parties must preserve documents and data that could be relevant to a claim or defense, even if doing so conflicts with a company's normal data practices. Either Coinkite has been served with a preservation notice by a plaintiff, or the firm anticipates receiving one soon. No lawsuits have been publicly filed as of early August.
The suspension puts Coldcard users in a position where their transaction history and account metadata remain stored by the company indefinitely unless they actively opt out. Hardware wallet makers with past security incidents have faced tension between privacy promises and litigation exposure. The number of customers affected by either the firmware breach or the data preservation suspension remains undisclosed.
If Coldcard does not receive formal legal discovery requests or dismiss anticipated proceedings within a reasonable timeframe, the data hold will remain an indefinite business practice rather than a temporary measure.
