Nobody broke a hardware wallet in the Ngrave hack. Attackers hijacked the access of the outside provider that sends push notifications for LIQUID, the companion app of Belgian wallet maker Ngrave, and at 21:30 UTC on 17 October used it to send a fake security alert. Users who followed it and typed their recovery phrase into a copy of Ngrave’s website lost at least $2.56 million from about 70 wallet addresses, according to Ngrave’s incident report, published on 19 October. The first wallet was emptied six minutes after the alert went out.
Ngrave says neither the LIQUID app’s code nor its ZERO hardware wallets were breached, and private keys never leave the ZERO. The money left because victims gave away their 24-word phrase or their Perfect Key, Ngrave’s metal backup, and automated scripts rebuilt and emptied the wallets within minutes.
Ngrave also admits a second problem that will outlast the thefts. The attacker copied LIQUID’s notification list and could read users’ blockchain, where users swap tokens directly from their own wallets without handing custody of their funds to a company.">swap history, which ties wallet addresses and amounts to phones, countries and possibly IP addresses. Ngrave is reporting the exposure to the Belgian Data Protection Authority.
Ngrave is the second wallet maker in two days to see its own app used against its customers: SecuX users received a similar fake alert on 16 October, although no breach or theft has been confirmed there.
How the fake LIQUID alert worked
The message arrived both as a push notification and as a banner inside the app. It said the wallet had just been synced on a new device: “Pixel 9, Moscow (today, 21:30)”. Tapping it opened a copy of Ngrave’s site with a “Was this you?” screen, a countdown and a Deny button. Pressing Deny led to a page asking for the Perfect Key or the 24-word recovery phrase.
Ngrave adds that some victims may also have added a fake web app called “NGRAVE Security Center” to their phone’s home screen. Anyone who did should delete it.
None of this is new as phishing goes: a stranger in Moscow, a clock running down, a button that seems to protect you. What changed is the envelope. The alert did not come from an unknown number or a lookalike email address. It came through the official channel of the wallet app, which is what made it believable. The CEO’s note in the report calls it “A classic trick, and one that we at NGRAVE should have prevented.”
Ngrave does not name the provider. According to the report, the attacker first took one access key to the provider’s service and then used it to obtain a second, more powerful one. The earliest sign of access dates from 11 October. The second key could also read some LIQUID analytics data, and change some of it; Ngrave says it is checking whether the attacker did. Chinese outlet PANews wrote that the first key leaked through an error message from the notification server, a detail that does not appear in Ngrave’s report.
Ngrave hack timeline: six minutes to the first theft
Every time in Ngrave’s report is given in UTC. The sequence on the night of 17 to 18 October:
| Time (UTC) | What happened, according to Ngrave |
|---|---|
| 11 Oct | Earliest sign of access to the notification provider |
| 17 Oct, 21:30 | Fake alert sent to LIQUID users |
| 21:31 | Ngrave’s team spots it |
| 21:36 | First wallet emptied |
| 21:40 | First key cut; alerts keep going out through the second key |
| 22:30 | Warning posted on X |
| 22:40 | Warning sent by email |
| 22:45 | All notification sending shut down |
| 23:14 | Fake site reported to its domain registrar |
| 17 Oct 23:28 to 18 Oct 04:20 | Attacker moves funds to an exchange, a bridge service and new addresses |
| 18 Oct, 03:51 | Last theft traced |
| 18 Oct, 09:37 | Every key used by live systems replaced |
The gap between 21:40 and 22:45 is the costly part. Cutting the first key did not stop the alerts, because the attacker held the second one, and an hour passed before every notification was switched off. Shutting the channel also could not help people who had already typed their phrase: thefts from those wallets went on until 03:51.
Ngrave counts $2.56 million on four networks; Bitquery counts $2.65 million
Ngrave’s figure is a minimum, valued at 17 October prices: about $2.56 million traced so far from about 70 addresses on Bitcoin, XRP, Ethereum and Stellar. Blockchain analytics firm Bitquery, as reported by CryptoSlate, estimates about $2.65 million in suspected losses across 84 wallets on six chains over roughly six hours.
| Network | Ngrave’s report | Bitquery (via CryptoSlate) |
|---|---|---|
| Bitcoin | $1.77 million | about $1.76 million from 21 wallets |
| XRP | $454,000 | affected, no figure given |
| Ethereum and tokens | $316,000 | affected, no figure given |
| Stellar | $18,000 | affected, no figure given |
| Solana, Dogecoin | not listed | affected, no figure given |
| Total | about $2.56 million, about 70 addresses | about $2.65 million, 84 wallets |
Bitquery found suspected victims through transaction patterns and reported losses, and says other phishing attacks may have hit some of the 84 wallets, CryptoSlate wrote. The 14-wallet gap is therefore not proof that Ngrave undercounted.
Where the stolen funds went: ChangeNOW, LI.FI and Hyperliquid
Each network is traced separately in the report. The bitcoin went to one attacker address and was then split across 12 new addresses. The XRP was paid into the ChangeNOW exchange service in 54 deposits, and Ngrave has asked ChangeNOW to freeze it. On Ethereum, the stolen tokens were sold for ETH and all 130.47 ETH was moved to other chains through LI.FI, a cross-chain routing service; about $2,900 of unsold tokens still sits in the attacker’s wallet. The Stellar coins went to what looks like an exchange deposit address.
Bitquery’s tracing, as reported by CryptoSlate, adds a later stage. Much of the bitcoin went through 12 swaps on Chainflip, a cross-chain swap protocol, while Ethereum and Solana proceeds crossed bridges. The routes converged on 39 accounts on Hyperliquid, a decentralised exchange, which bought about 3,593 XMR1 tokens, a token that tracks Monero, for $2.16 million. Bitquery told Bitcoin.com News that roughly 81% of the stolen funds reached Hyperliquid.
At Bitquery’s last check on 19 October those tokens had been neither sold nor withdrawn and were worth about $2.12 million. Bitquery cautions that other onward routes are unproven. Ngrave’s report does not mention Hyperliquid or Monero.
Ngrave says it preserved its logs, reported the incident to the authorities and asked exchanges and bridges to freeze the funds. No freeze or recovery has been confirmed so far, and the attacker has not been identified.
What data the attacker could reach, and the risk of targeted scams
Ngrave separates what was copied from what could only be read. The notification list was copied on 17 October. It holds one entry per phone: the notification token, phone model and operating system, LIQUID version, language, country, time zone, usage data, an internal app ID and possibly the IP address and approximate location.
The second key could also read swap history (addresses, amounts, times and recent balances), and Ngrave is still checking whether it was copied. App usage data and data-deletion requests were within reach too; the latter hold an email address and order number for a small number of customers. Names and shipping addresses sit in a separate system the attacker could not reach, Ngrave says, and the same goes for the ZERO, private keys, recovery phrases and Perfect Keys.
Put together, that data is a scammer’s starter kit. Linking a wallet address and its balance to a phone model, a country and an approximate location lets someone write a message that sounds exactly like Ngrave, or pick out the largest holders. Ngrave itself names this risk of targeted scams, and is reporting the exposure to the Belgian Data Protection Authority, the regulator responsible under the EU’s GDPR for a company based in Belgium.
Ngrave’s CEO: “we have absolutely and utterly failed”
A note from the chief executive, signed only “R”, closes the report. “In this, we have absolutely and utterly failed,” he writes. He contacted every affected user individually, the report says, and since 18 October each affected customer has a case number starting with OSH.
Ngrave lists the changes it plans. LIQUID will only open links to Ngrave’s official sources. The notification key will be able to send and nothing else, access will be limited to Ngrave’s own servers with two-factor authentication, and alerts will fire on unusual use and bulk data exports. Every notification will need two people to approve it, keys will be replaced at least every 90 days, and a single kill switch will cut the whole system. The company is also reviewing whether it should keep swap history at all.
SecuX two days earlier: a fake alert, no confirmed breach
On 16 October SecuX, a Taiwanese hardware wallet maker, announced emergency maintenance. David Schwartz, Ripple’s CTO emeritus, then posted a notification seen in the SecuX app that warned of a “critical vulnerability” and told users to verify their wallet immediately, linking to a page asking for a 12- or 24-word phrase, CoinAlertNews reported. His advice: “NEVER DO THAT!”
SecuX has not explained the cause, and the reports seen confirm neither a breach nor a theft. It told users never to share their recovery phrase and not to click unverified links. No source links the SecuX alert to Ngrave’s provider or attacker. Kraken’s chief security officer Nick Percoco called Ngrave the second wallet manufacturer in two days whose app notifications were used to steal recovery phrases, CryptoSlate reported.
It has been a hard year for wallet makers. CryptoSlate recalls a Coldcard firmware flaw in July that weakened the randomness of recovery phrases, with about $116 million in bitcoin stolen on TRM Labs’ estimate, and resold Ledger devices fitted with hidden parts that capture phrases, linked to more than $90 million in suspected thefts. We covered the Ledger case in our report on tampered Ledger devices, and the quarter’s wider toll in our review of Q3 crypto hacks.
SEAL’s week: seed-phrase theft is the most common loss
The Security Alliance (SEAL) counted 70 incidents between 13 and 20 October in its weekly report, published on 20 October. It does not mention Ngrave or SecuX, so neither case is in the tally.
The largest category was the CryptoBilis case linked to resold Ledger devices, at $9.3 million. Seed-phrase compromise came next with $3.86 million plus 64.5 ETH and 0.3 BTC; Journal du Coin counts 25 of the 70 cases in that category. SEAL also lists $2 million plus 37.44 ETH in protocol compromises, $1.6 million in account takeovers, $1.22 million in physical “wrench” attacks, $316,000 plus 0.47 BTC in malware, $284,000 in phishing and $260,000 in intrusions attributed to North Korea. The categories add up to roughly $18.8 million.
Few of those losses involved broken cryptography. Most came from people being led, by a device, a message or someone at the door, to hand over the words that control their coins. Jameson Lopp’s list of wrench attacks tracks the physical side of the same problem.
What to do if you use Ngrave LIQUID or any wallet app
The first three points are Ngrave’s own advice in the report; the last two are standard practice for self-custody.
- If you typed your recovery phrase or Perfect Key on the fake site, treat that wallet as unsafe on every network and move the funds to a new wallet with a new phrase. Ngrave says this applies even if the site claimed the phrase was wrong or you typed only part of it.
- If you only opened the link, your funds are safe, according to Ngrave. Delete the “NGRAVE Security Center” web app if you added it.
- File a police report if you lost funds, since exchanges rarely freeze anything without one, and ignore anyone offering to recover the coins for a fee.
- Treat every security alert as unverified, even inside the official app. Close it and open the app or the maker’s site yourself.
- Expect messages that use your phone model, country or recent swaps. Accurate details do not make a message genuine.
Our guide to storing a recovery phrase safely explains how to back up the words without exposing them, and our glossary entry on the seed phrase explains what it controls.
Why a recovery phrase is worth more than the device
A hardware wallet does not hold coins. The coins live on their blockchains; the device holds the private keys that sign transactions, and those keys come from the recovery phrase. Anyone with the 24 words can rebuild the same wallet in any compatible software, anywhere, without the device. That is why the attackers never needed to touch a ZERO.
For readers in France and Italy the limit is the same. A self-custody wallet is not a regulated account, and no bank or insurer reverses a transaction signed with your own keys. Recovery depends on tracing and on exchanges agreeing to freeze funds, which Ngrave has requested from ChangeNOW and others.
Open questions after the Ngrave report
Ngrave has not named the notification provider, nor said how many users received the alert or typed their phrase. It has not yet said whether the swap history was copied or whether the attacker changed any analytics data. Whether the 14 extra wallets in Bitquery’s count belong to other phishing victims is unresolved. The next signs to watch are a reply from ChangeNOW on the frozen XRP, any movement of the XMR1 tokens on the 39 Hyperliquid accounts, and the updates section of Ngrave’s report.