Trust Wallet Extension Flaw Drains $7M — Company Pledges Full Refunds
Trust Wallet confirmed a security incident in its Chrome browser extension v2.68 that led to roughly $7 million in funds being drained. Blockchain investigator ZachXBT first flagged suspicious drains after users imported seed phrases into the extension; researchers suspect a supply‑chain or malicious update introduced the vulnerability. Trust Wallet says the issue was isolated to v2.68 — mobile apps and other extension versions were not affected — and advised users to disable the extension immediately and update to v2.69. The company published an official update on Dec 26, is conducting internal audits, has not disclosed a full technical root cause, and warns users to ignore messages outside official channels to avoid follow‑on phishing scams. Trust Wallet has committed to fully refunding affected users and is finalising the refund process. Key trader actions: monitor TWT sentiment and on‑chain movements from drained wallets, avoid interacting with untrusted extensions, consider moving high‑value holdings to hardware wallets or multisig, and verify any refund instructions via official Trust Wallet channels. Primary keywords: Trust Wallet, browser extension security, $7M loss. Secondary/semantic keywords: supply‑chain attack, seed phrase compromise, refund, on‑chain draining, extension update.
Bearish
The incident directly harms Trust Wallet’s brand and user trust, which is likely to produce negative short‑term price pressure on its native token (TWT) via sentiment and sell pressure. The confirmed $7M drain and the fact the vulnerability affected a widely used browser extension create immediate reputational risk; traders typically respond by reducing exposure to the project until the company demonstrates robust remediation. The company’s commitment to refunds and a contained scope (only v2.68) mitigate some long‑term damage, but uncertainty over the technical root cause and potential for follow‑on phishing scams sustain caution. Short term: elevated selling and negative sentiment for TWT; potential spike in on‑chain activity from drained wallets could increase volatility. Medium/long term: if Trust Wallet completes refunds, publishes a transparent post‑mortem, and implements stronger supply‑chain safeguards, sentiment could stabilise; failure to do so would prolong negative impacts. Overall, immediate outlook is bearish for TWT until clarity and verified remediation are established.