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Cardano faces a major wallet security crisis after users reported losses of more than 16M ADA. The breach came from compromised seed phrases in SecondFi, a widely used Cardano wallet. SlowMist said total losses may reach $20 million, while more users may still report missing funds.
SecondFi completed its migration from Yoroi Wallet on June 12, only days before the attack. The team said exposed private keys caused the incident. It also warned users not to recover their seeds in another wallet app.
Users reported that their funds drained quickly. Analysts said the attacker may have accessed a database of available keys. That could let the attacker sweep funds after any user signs a transaction.
SecondFi paused its frontend and urged users to delete the app and browser extensions. The team also advised affected users to move funds to a hardware wallet if they have one. What happens when a self-custody wallet exposes the very seeds it should protect?
SecondFi, formerly Yoroi Wallet, came from Emurgo Labs, a founding entity in the Cardano ecosystem. That link made the incident more serious for users and observers. The breach did not come from a third party.
Analysts traced the exploit to SecondFi’s own wallet generation software. They also said all generated private keys may have been compromised. That raised fears that more wallets could remain exposed.
The attack also hit Cardano NFTs. The hacker stored the stolen NFTs in another wallet. Meanwhile, the attacker’s wallet reportedly received funding from a Binance account, which researchers said could help with tracing.
Read More: Cardano Holds Near $0.180 as Traders Split Over ADA’s Next Move
ADA traded sideways before the exploit, and the token slipped after the news. It fell 2.9% in 24 hours to $0.15. The token also dropped out of the top 20 coins and tokens.
The article said ADA has lost more than 54% year to date. It also said the token would start 2026 at around $0.42. At the same time, the Cardano community has faced growing doubts as apps and projects have left the platform.
SecondFi said users must move funds quickly to a different type of wallet. The team also worked to isolate affected addresses. Cardano’s treasury still holds 352.4M ADA, and some voices suggested using it to help affected holders.
The Cardano wallet hack exposed major risks after SecondFi seed leaks drained more than 16M ADA and may have affected even more users. The incident has triggered urgent warnings, raised trust concerns, and pushed holders to move funds quickly to safer wallets.
