A crypto investor has reportedly lost nearly 50 million yuan (approximately $6.9 million USD) worth of cryptocurrency after purchasing a cold wallet from the Douyin platform, the Chinese counterpart of TikTok.
According to a security alert issued by SlowMist’s Chief Information Security Officer, known as 23pds, the wallet had been pre-compromised, with the private key stolen at the moment it was generated.
The stolen funds were rapidly laundered through Huiwang, a known mixer service, within just a few hours.
The incident highlights the growing sophistication of crypto-related fraud and serves as a stark warning to users about the dangers of buying security hardware through unofficial or non-vetted channels.
Cold Wallet Was Actually a Carefully Designed Trap
Though cold wallets are often promoted as the safest way to store cryptocurrencies offline, this case reveals that their security is only as strong as the trustworthiness of the source.
The wallet, believed to be “brand new and unopened,” was purchased through an ad or vendor listing on Douyin. However, the device had likely been tampered with before reaching the buyer.
Once the unsuspecting investor initialized the wallet and began transferring funds into it, the compromised private key gave hackers immediate access.
All assets were then funneled out within hours, before the victim even realized the breach had occurred. This reveals how counterfeit cold wallets are increasingly being used as advanced phishing tools in the crypto space.
Also Read: Crypto Investigator SlowMist Detects Possible Security Breach Targeting Nexo Crypto Platform
Industry Experts Urge Users to Stick to Official Channels
SlowMist’s security team emphasized that 99% of the cold wallets sold online under the guise of “special deals” or “unopened stock” are likely compromised.
These devices may look legitimate but are preloaded with vulnerabilities that give attackers access to any assets stored on them.
Experts stress that purchasing a cold wallet is not an area to cut corners, saving a few dollars upfront can lead to catastrophic losses.
Best practices include buying only from official websites, initializing the device personally (never accepting pre-generated keys), and using robust multi-factor authentication wherever possible.
According to 23pds, secure cold wallet usage is a three-part formula: official source + personal setup + secure operation.
Also Read: ‘Fake Ledger’ Scam Returns, Crypto Scam Detector Slowmist Urges Users To Beware Counterfeit Devices
A Painful Reminder: Technology and Superstition Intersect
Beyond the technical failure, the victim’s close circle even reflected on the incident through a lens of traditional Chinese metaphysics.
A friend noted that the victim’s name contained Chinese zodiac characters that coincided with a period of “offending Tai Sui,” a time believed to bring bad fortune.
While clearly not a cause of the hack, it adds a layer of cultural interpretation to an otherwise modern cybercrime.
Regardless of superstition, the core lesson remains grounded in real-world caution: in the crypto world, personal security lapses, whether digital, physical, or procedural, can lead to irreversible losses.
The $6.9 million mistake is a chilling reminder that even the best tools, when sourced from the wrong places, can become gateways for devastating attacks.
Also Read: Blockchain Security Firm SlowMist Warns of Fake Telegram Groups Running Phishing Scams