Trust Wallet Hack 2026: What Crypto-Using SMEs Must Learn

This article was first published on Deythere.

In late December 2025, thousands of users had about $7 million in cryptocurrency stolen from them after a hijacked update to the Trust Wallet Chrome browser extension. 

Trust Wallet, which is owned by Binance’s Changpeng Zhao, was quick to warn its members to update the extension from version 2.68 to a safe version 2.69 and organized timing for reimbursements for anyone affected. 

In all, Trust Wallet said it has verified that about 2,596 wallet addresses were affected, and that around 5,000 claims for reimbursement had been submitted, with many duplicates. 

The rapid-fire hack bared the fact that even tools intended for convenience such as browser wallet extensions can become liability-riddled house of horrors for individuals and small businesses alike.

How the Trust Wallet Hack Went Down

The Trust Wallet hack capitalized on a sneaky supply chain breach. In the official extension’s code, attackers inserted malicious JavaScript and employed a stolen Chrome Web Store API key that allowed them to avoid Trust Wallet’s regular release checks. 

Users that unlocked the extension had their wallet seed phrases silently collected by the malicious code. Version 2.68 included a script that threw prompts to ask for a recovery phrase, and then decrypted and sent out each one of the users’ mnemonic to a server controlled by the attack. 

In other words, the hackers did not compromise the blockchain but they broke the trust of the update mechanism. The attacker’s code was disguised as a bona fide analytics library, hidden in plain sight until a seed phrase was imported. Once the attackers acquired the seed phrases, they emptied wallets nearly as soon. 

Blockchain analytics indicate that about $3 million in Bitcoin and $3 million in Ether was stolen, as well as smaller amounts of other coins.

Majority of the funds that were stolen were passed through centralized exchanges and cross-chain bridges for laundering. 

The team at Trust Wallet has since suspended the offending extension and disabled the attacker’s domains, but most of the money was transferred already. The company promised to reimburse victims, and cautioned users not to share recovery phrases or click on unfamiliar links.

The immediate fallout sent out waves of distress. Several of the victims that were compromised had thought a browser extension was as safe as the desktop or mobile app, but they did not know web wallets are “hot wallets” that connect to the internet. 

Within hours of the breach announcement, fraudsters carried out a parallel phishing campaign. Fake Trust Wallet sites such as “fix-trustwallet. com” and imposter support messages lured scared users into inputting their recovery phrases, claiming to help them recover funds.

Trust Wallet cautioned users not to respond to any unofficial compensation forms or unsolicited queries, emphasizing that legitimate support providers would never request a seed phrase. 

The incident reignited the debate over self-custody. Many security experts advised users and businesses to store larger crypto holdings on hardware wallets, which sit offline (cold) and are not vulnerable to such online exploits.

Why Crypto-Friendly SMEs are at Risk

Trust Wallet is a personal wallet for controlling own funds, but the compromise reveals some of the shared security vulnerabilities faced by crypto-friendly small and medium businesses (SMEs). 

The mechanics of the attack show common weaknesses, which also impact crypto-friendly SMEs.  In working conditions, most SMEs that either accept or use cryptocurrency will be using the same tools as individual users, these are browser-based wallets, mobile wallets, API services . A supply-chain attack on any widely-used crypto tool can therefore disrupt not just hobbyist users but also startup payroll systems, boutique exchanges, DAOs, and fintech apps.

For instance, a small-scale crypto-mining operation or retail business could rely on a browser extension to handle day-to-day funds or ease the experience of customer payments. 

If that extension is breached, the company might rapidly hemorrhage big assets. With the Trust Wallet episode, it is now known that attacks targeting individuals (such as a wallet upgrade) can trickle down to the SME space if a business relies on such tool. 

Ultimately, any crypto-oriented program or device an SME might use should be considered a potential failure point as it is to the consumer.

Typical Security Lapses Exposed by the Hack

The Trust Wallet incident exposes several vulnerabilities that SMEs need to fix:

Supply-Chain and Update Risks: Many of today’s crypto services use browser extensions / SDKs / APIs from third parties in order to develop features faster. All the extra bits enlarges the attack surface. In this case, a stolen API key allowed attackers to push a malicious wallet update without Trust Wallet’s knowledge.

That’s a lesson SMEs need to learn. They have to vet all third-party software components and check for dodgy updates. A vulnerability in a side tool and not the core system can still cause big losses.

Over-Reliance on Hot Wallets: Companies occasionally hold crypto in online wallets for liquidity. But hot wallets connected to the internet are at risk from malware and malicious updates. The Trust Wallet breach was able to occur specifically because the private keys were held by the user on their device and exposed to the compromised extension.

For small and medium sized enterprises, one compromised computer or logged-in browser could mean all crypto reserves are leaked. As experts advise, major assets should be stored in offline (cold) wallets, while only small operational balances remain hot

Verification Process Loopholes: Trust Wallet had to deal with thousands of refund requests when news of the hack broke out. The company cited numerous false or duplicate claims, showing how unprepared systems can be easily overwhelmed. If an SME handles issuing its own reimbursements, payroll crypto or client deposits, it requires strong identity and transaction checks up front.

Without those, it is possible to prey on the confusion that can come with an event. Good “Know Your Wallet” (KYW) checks, multi-sig approvals and staff training are essential to prevent non-authorized parties from taking the ship home.

Phishing and Social Engineering: The attacker’s decision to go ahead and build fake Trust Wallet “fix” websites is proof of how fast a bad actor can leverage social engineering after something happens. SMEs are exposed to the same threat: their staff will be jumpy following a breach, and attackers can dupe them with an email, SMS or social media request for login details.

Of course training staff to spot phishing and using email filters or device policies is an essential defense. Trust Wallet’s warning to “never share your recovery phrase” is just as relevant to any SME which handles crypto.

Safeguards for Crypto-Friendly SMEs

Following the hack, and similar incidents, SMEs focused on cryptocurrency should implement more stringent security safeguards:

Cold Storage for Reserves: Leave the bulk of funds offline. Keep in hot wallet only the crypto required for daily, immediate transfers. This principle limits exposure, so that even if a hot wallet is hacked, the businesses do not lose their entire treasury.

Multi-Factor Authentication (MFA): Require MFA everywhere on all accounts and devices involved in crypto access. This means even if a password or a seed is stolen, an attacker still cannot log in without that second factor. In addition, SMEs should also use hardware security keys or biometric locks where available.

Incident Response Planning: A defined, tested response plan is needed for what to do if there’s a breach. This entails who to tell (customers, regulators, partners), how to freeze or unfreeze assets and how best to communicate publicly. The Trust Wallet hack showed how panicked attempts to organize a reimbursement process while under attack can be messy.

Clear policies made in advance and including contact lists, alternative secure systems and protocols for verifying losses, will save time and money when seconds matter.

Regular Security Audits: Enlist third party experts to audit code, infrastructure and vendor security practices. External audits can find integration points that internal teams might miss.

For example, a code review could have discovered the hard-coded analytics script in the Trust Wallet extension. Cryptographic hardware (HSMs) and wallet solutions with audited firmware add another layer of trust.

Strong access controls and whitelists: Limit who should be able to authorize transactions. If large sums are transferred, require more than one person to approve it (multi-sig wallets). Whitelist withdrawal addresses so that funds can only be sent to a pre-arranged destination. SMEs, however, can introduce those controls even at a small scale; they are common in banking and should be applied to crypto operations.

Continuous Employee Training: Train employees on phishing, how to safely handle recovery phrases, the importance of official channels. The Trust Wallet hack had demonstrated that confusion was the door to scams. If employees know the signs of a phony site or an urgent “update your wallet” message, they’re less likely to click a harmful link.

Regular simulations of phishing attacks and guide cards (like “Trust Wallet will never ask you for your seed”) contribute to a culture that is conscious about security.

By implementing these defenses, businesses that handle crypto can harden the weak places that the attack on Trust Wallet exploited.

Regulatory Perspective

The Trust Wallet hack did not, in itself, bring about new legislation, but happened at a time when authorities are clamping down on crypto. World regulators introduced major initiatives (e.g. the EU’s MiCA in 2025). Authorities are increasingly expecting even smaller crypto businesses to follow best practices for custody and consumer protection.  

For crypto friendly SMEs, the result is that failures can have legal consequences. Such security lapses now carry both financial and compliance risks. SMEs will also need to keep up-to-date on crypto regulations, as requirements around incident reporting, know-your-customer and safe custody become the norm.

This could mean timely disclosure of hacks, required audits or insurance/compensation plans. For now, the lesson is, tightening the technical security of crypto tools is a way to meet new legal standards. Businesses that ignore crypto security might end up being punished not only by theft but also by the regulators who implement new rules about digital assets.

Conclusion 

The Trust Wallet hack has shown that all businesses big or small need to be extra cautious of every crypto tool they deploy. Crypto-friendly SMEs can take this as a lesson. 

With cold wallets, multi- factor safeguards and solid audits in place, they turn a very high profile hack into a map for safer operations. 

Tight security and readiness are no longer a optional, they are vital for success in today’s changing crypto environment.

Glossary

Trust Wallet: A non-custodial cryptocurrency wallet app and browser extension initially an independent project, now owned by Binance. It helps users store their cryptos privately using seed phrases.

Chrome Extension: A small piece of software that enhances the functionality of Chrome web browser. Trust Wallet extension combines Chrome with cryptocurrency wallet functions.

Seed Phrase (Recovery Phrase): List of words that help an user recover his Crypto wallet. Whoever has the seed can access all of the funds. 

Hot Wallet vs Cold Wallet: A hot wallet is online (like a mobile app or browser wallet), so transactions are convenient to perform but the security level is lower. A cold wallet puts keys offline (for example on a hardware device) and is far less susceptible to hacking. 

Multi-Factor Authentication (MFA): Security that needs two or more forms of verification such as a password and a code on your phone, to gain access to an account. MFA can stop attackers from gaining access even if they have obtained stolen credentials.

Phishing: Scam in which the attacker tries to fool users into providing private information (such as a password or seed phrase) via an email, message or website. 

Frequently Asked Questions About the Trust Wallet Hack

What happened in the Trust Wallet hack?

In December 2025 , hijackers leveraged a compromised Chrome Web Store API key to release a malicious update to Trust Wallet’s browser extension (version 2.68). The rogue update quietly captured each user’s private recovery phrase (seed) and sent it to the hackers. Using these seeds, thieves emptied a total of 2,600 wallets, or about $7 million in crypto. Trust Wallet patched the flaw in version 2.69 and is refunding those affected.

How much were hackers able to steal from the hack?

Nearly $7 million in cryptocurrency was stolen. Blockchain security companies estimate the amount to be around $3M in Bitcoin and another $3M in Ethereum, plus smaller amounts from other tokens. Many of the stolen funds have since been tracked to exchanges, where they were exchanged or laundered.

Is a small business vulnerable to that type of an attack?

Yes. The attack went after a popular cryptocurrency tool (a browser wallet), so all businesses depending on similar tools could be affected. A small business making vendor payments or holding payroll funds in a browser or mobile wallet extension would, for example, be affected if it was compromised. 

What can SMEs do to safeguard their crypto assets after such a breach?

Businesses should keep most of their crypto in cold wallets and only have operational funds in online (hot) wallets. They should require multi-factor authentication on all accounts, conduct regular security auditing and have a crisis response plan. It is important to have staff trained to prevent phishing and verify official communications. 

References

bankinfosecurity

coesecurity

chainalysis