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Coldcard Hacker Deposits $445K in Stolen Crypto Into Duel
A public dispute between Galaxy Digital's Alex Thorn and crypto casino Duel unfolded on X after hundreds of thousands of dollars in allegedly stolen crypto from a Coldcard victim was traced to the casino.
GamblingLore Editorial Desk3 August 2026
A public dispute took over the timeline on X after Galaxy Digital's Head of Firmwide Research, Alex Thorn, accused crypto casino Duel of failing to immediately freeze funds that had allegedly been stolen during a recent Coldcard wallet compromise.
According to Thorn, a victim who lost nearly 30 BTC had approximately 17 BTC bridged through THORChain into Ethereum before 229.72 ETH (roughly $445,000) was deposited into Duel.
Thorn said both the victim and an independent blockchain researcher contacted Duel within minutes of the deposits, providing transaction IDs and a complete forensic trail linking the funds from the compromised wallet to the casino deposits. He criticized the operator after support reportedly responded by requesting that law enforcement contact the company before any action could be taken.
"this is an outrageous response. it's well after midnight in most of the western world. no police report is coming until at least Monday."
He further claimed that if Duel failed to freeze the assets after receiving detailed forensic evidence, the platform would be "complicit in theft."
Duel Explains Its Position
Duel team member Korra publicly responded, arguing that freezing user balances based solely on a third-party claim would create significant abuse risks.
The Duel team explained that anyone could falsely allege another user's funds were stolen and request a freeze, making some form of verification necessary before restricting access to customer balances.
However, Duel said it was willing to make an exception given the circumstances surrounding the Coldcard compromises.
According to Korra, the victim would need to:
- Sign a message proving ownership of the compromised wallet.
- Provide an affidavit confirming they were the victim of the theft.
- Supply the transaction trail linking the stolen funds to Duel.
Upon receiving that information, Duel said it would temporarily freeze the account without waiting for a police or court order.
The company maintained that its normal policy requires official confirmation from law enforcement before freezing user funds, describing customer balances as something that should only be restricted under a high legal threshold.
Forensic Evidence Debated
Thorn pushed back, stating that Duel had already been provided with comprehensive blockchain forensic evidence.
According to him, investigators had supplied every transaction ID and every transfer linking the stolen Bitcoin to the deposits made on Duel.
Korra later replied that while the evidence had been reviewed, the originating Bitcoin transaction did not match any of the primary publicly tracked Coldcard hack wallets and appeared on-chain as a normal spend. Because of that, Duel requested confirmation directly from the owner of the compromised address before taking action.
The discussion then moved to private messages.
Funds Left Before Freeze
Later, Thorn posted an update confirming that Duel had cooperated with investigators and identified the account holder responsible for the deposits.
However, he said the cryptocurrency had already left the platform before a freeze could be implemented.
According to Thorn, Duel now possesses the depositor's identity and expects it can assist law enforcement once the victim submits a formal police report.
He also noted that this incident does not appear to be connected to the larger "Wave 1," "Wave 2," and "Wave 3" Coldcard thefts previously tracked by Galaxy Research, instead suggesting that additional attackers or copycat actors are now targeting remaining compromised Coldcard seed phrases.
Raises Questions for Crypto Casinos
The exchange highlights a recurring challenge for crypto gambling operators: balancing user privacy and due process with the need to respond quickly when allegedly stolen digital assets are traced onto their platforms.
While blockchain analysis can provide detailed transaction histories within minutes, operators must also consider the legal and reputational risks of freezing customer funds based solely on claims made by third parties. In this case, both sides ultimately worked together.
