Why Weak Randomness Breaks a Bitcoin Wallet

Your Bitcoin key is basically just a massive random number. If someone can guess it, the coins are theirs. So the whole thing rests on that number really being random, which sounds simple right up until it isn't.

There was a good example of this recently with a hardware wallet called Coldcard. These are meant to be the safe option, offline, keys never leave the device. But a tiny mistake in the firmware meant it stopped using the real hardware randomness and quietly fell back to a weak software version. The check was basically testing whether a setting existed instead of whether it was turned on. It compiled fine, nothing broke, and the keys still looked random, so nobody noticed for years.

Problem is the numbers were way easier to guess than they should've been, and eventually someone worked that out and drained the wallets that were affected.

The part that stuck with me is you can't really patch your way out of it. Updating the firmware fixes new keys, but a key that was already made weak stays weak. You have to start fresh and move everything across.

So yeah. On a device whose whole job is keeping a secret, the randomness has to be the real thing. When it fails quietly like this, you find out way too late.