A crypto investor recently suffered a catastrophic loss after purchasing a discounted “cold wallet” from Douyin’s has an e‑commerce platform—China’s version of TikTok—only to discover it had been compromised before delivery. Instead of securely storing private keys, the wallet arrived preloaded with a backdoor: the private key was already known to the scammers. Within hours, the investor’s funds—nearly $6.9 million—were drained from the device by malicious actors, according to security firm SlowMist.
Industry experts emphasize that falling for curiously cheap cold wallets can be disastrous. SlowMist’s CISO warned on X that “you’re not saving money, you’re throwing your life away” when you gamble your entire fortune on a device merely because it’s a few hundred bucks cheaper. The scammers advertised these wallets as “factory sealed” to entice buyers, but in reality, they’d been tampered with during the manufacturing or packaging process.
A former Bitmain team member, known as Hella, recounted how he received an eerie late-night call from the victim, describing the wallet as a “carefully designed hot trap.” He noted the funds were rapidly “washed away through Huiwang” — a Cambodian-linked laundering network — within just a few hours.
Unfortunately, tracing the stolen cryptocurrency offered little promise for recovery. Although blockchain analytics could trace the transaction on-chain, the odds of recovering funds vanished quickly once they passed through illicit laundering services. The episode serves as a stark reminder: security in crypto begins with trusted sources. Cheap deals from unverified sellers often come at an exorbitant cost.
