A security breach tied to Trust Wallet has now been traced back weeks before funds were actually stolen, revealing a slow-burn attack that only surfaced once it reached its final stage over the Christmas holiday.
Rather than exploiting a sudden vulnerability, attackers appear to have patiently positioned themselves inside the wallet’s browser extension workflow. The incident ultimately led to losses of roughly $7 million, affecting hundreds of desktop users who had installed a specific version of the extension.
Key Takeaways
The Trust Wallet exploit was planned weeks in advance and triggered on Christmas Day.
About $7 million was drained from hundreds of desktop wallet users.
The attack involved a backdoor embedded in a compromised browser extension.
An update became the entry point
The incident centered on Trust Wallet’s Chrome browser extension version 2.68. Users running that version unknowingly interacted with compromised code, while mobile wallets were not affected. Trust Wallet later urged users to immediately upgrade to a newer version once suspicious activity was detected.
What makes the case unusual is the timing. Although funds were drained on Christmas Day, blockchain security researchers say the exploit was prepared far earlier, suggesting the attackers waited until enough users were exposed before triggering the theft.
A backdoor, not a brute-force hack
According to findings shared by SlowMist, the malicious code embedded in the extension went beyond enabling unauthorized transfers. It also collected user data and quietly sent it to external servers controlled by the attacker.
SlowMist co-founder Yu Xian described a multi-step operation: early preparation in December, insertion of a backdoor days before Christmas, and execution once the environment was primed. That level of sequencing suggests intimate knowledge of the extension’s architecture.
Hundreds of wallets, one coordinated drain
Blockchain investigator ZachXBT identified hundreds of affected wallets, with funds moved rapidly and in similar patterns. The consistency across transactions reinforced the view that this was not user error or phishing, but a coordinated exploit executed at scale.
Although the $7 million loss is small compared with some historic crypto hacks, it stands out because it targeted personal wallets rather than exchanges, a category that continues to grow as an attack surface.
Binance promises reimbursement
Trust Wallet is owned by Binance, and Changpeng Zhao confirmed that affected users will be fully compensated. Zhao acknowledged the severity of the incident and said the losses would be covered, limiting the direct financial impact on victims.
That assurance, however, did little to calm concerns about how the compromised extension was able to reach users in the first place.
Insider access under scrutiny
Multiple industry figures raised alarms over the nature of the exploit. The attacker’s ability to push a modified version of the extension and their deep familiarity with the codebase led some to suspect internal involvement.
Blockchain adviser Anndy Lian openly questioned whether such an attack could occur without insider knowledge. Zhao himself echoed that view, stating publicly that the breach was “most likely” an inside job.
A wider warning for wallet users
The Trust Wallet incident arrives amid a broader shift in crypto security threats. According to Chainalysis, personal wallet compromises accounted for more than a third of crypto losses in 2025 once the unusually large Bybit hack is excluded.
As exchanges harden their defenses, attackers are increasingly targeting browser extensions and personal wallets, where update mechanisms and user trust can be exploited more easily.
Beyond the $7 million loss
While reimbursement may close the financial chapter, the incident leaves larger questions unanswered. How was the compromised code deployed? Who had access to the extension pipeline? And how many similar risks exist across other wallet providers?
For now, the Trust Wallet exploit stands as a reminder that in crypto, the most dangerous vulnerabilities may not be on the blockchain itself, but in the software layers users rely on to access it.
