Coldcard Hack, Big Tech Earnings, & RAM Shortage Woes

This Week at Arch: Security should have layers

A hardware wallet can be excellent and still be one link in the chain. When a meaningful amount of Bitcoin is on the line, security should not depend on one device, one seed phrase, or one person getting everything right.

That is why Arch does not hold borrower collateral in an Arch-controlled wallet. It is held by Anchorage Digital Bank, a federally chartered bank and qualified custodian built for institutional digital assets.

Here is what that means in practice:

• Segregated custody. Your collateral is held 1:1 in segregated wallets, separate from Arch's balance sheet.

• Zero rehypothecation. We do not lend it out, trade it, or use it for anything other than securing your loan.

• Multiple layers of control. Keys are stored offline, and transfers require authorized personnel and multiple verifications.

• Insurance coverage. Collateral held at Anchorage is covered by $100 million in Lloyd's of London insurance.

No system can make digital asset risk disappear. Our job is to remove single points of failure and build independent layers around your assets: qualified custody, separation, strict access controls, insurance, and real people accountable for every step.

Good security is boring on purpose, and we’ve thought this through every step of the way. Your Bitcoin stays put, stays visible in your dashboard, and comes back to you when the loan is repaid.

See how Arch protects your collateral →

This Week in Crypto

Bitcoin spent the week pretty flat with some small loss in ground, which honestly sounds like good news given all the volatility in recent months.

• BTC opened at $65,333 on Monday, July 27, held steady as markets waited on the Fed, then slid through the rate decision Wednesday and the earnings whiplash that followed - closing the week near $63,000, off about 3-4%.

• ETH had a rougher stretch too, falling from roughly $1,953 to under $1,850.

• Spot Bitcoin ETFs logged $61.5M in net outflows for the week, a sign institutional demand is staying cautious rather than stepping in to buy the dip.

Ethereum has restructured its entire backend:

• Lido kicked off the migration of more than 8 million staked ETH - about $16.5B - onto Ethereum's larger post-Pectra validators, cutting the network's total validator count by roughly a third.

• For the first time, Lido's node operators are backing their own stake with locked capital.

• Meanwhile Ethereum's overall staking rate hit a record 33.9% of supply, up from 30% in January.

And, of course, this week’s biggest and worst news, the Coldcard hack:

• A firmware flaw baked in back in March 2021 meant some wallets were generating seed phrases from a predictable software fallback instead of actual hardware randomness.

• An attacker figured out how to reconstruct the seeds using public data, like device serial numbers and timer states.

• The sweep started July 30 and moved fast: about $30M drained in the first ten minutes, targeting the highest-value wallets first, then rolling through additional waves over the following days.

• Total losses are now north of 1,800 BTC, more than $116M, pulled from over a thousand addresses, some of which had been sitting untouched for years.

• Coinkite caught the bug after roughly 30 hours and has since patched it, but still a hugely unfortunate event for those affected.

This Week in TradFi

A week that started a little ugly ended at record highs:

• Monday, July 27 set the tone badly: SanDisk fell nearly 12% after Chinese memory maker CXMT's push into DRAM spooked investors into pricing in future competition from Chinese chipmakers, dragging Micron and Kioxia down with it.

• Wednesday brought the Fed's rate decision, which triggered an afternoon selloff - the Dow dropped more than 800 points as Chair Warsh wrapped his press conference.

• Then Big Tech earnings Thursday and Friday flipped the mood entirely, and by Monday the Dow closed at a record 53,178, up nearly 700 points in a single session.

Apple briefly hit a $5T market cap on Tuesday, becoming only the second company ever to cross that line.

• Apple got there by largely sitting out the AI infrastructure spending race, leaning instead on strong iPhone demand and outsourcing its AI ambitions to Google for the Siri revamp.

• Nvidia, meanwhile, fell 5% the same day.

The FOMC held rates steady at 3.5%-3.75% on July 29, the fifth straight hold - but the vote was 9-3, with three officials dissenting because they wanted to hike.

• Markets sold off into and after the decision, which is not usually how "we held steady" news is supposed to land.

Big tech earnings split the AI trade down the middle:

• Microsoft posted its best single day since 2008, up roughly 8–9%, after Azure grew 43% and crossed $100B in annual revenue.

• Amazon jumped similarly on booming cloud growth and hiked its 2026 capex guidance to $220B.

• Meta went the other way, dropping about 9–10% after missing on EPS and issuing soft revenue guidance - investors are losing patience waiting for Meta's AI spending to show up other than the spending line.

And Leopold Aschenbrenner - 25, ex-OpenAI, author of the essay series that basically became the AI-infrastructure investment thesis - built his hedge fund Situational Awareness LP from $225M to a $45B peak in under two years on concentrated long bets in AI hardware names, posting a 439% return through June.

• July erased most of it: his longs fell 27–54% over the month while his short bets on software names went the wrong way too, and at roughly 4x leverage, the math turned brutal fast.

• Goldman Sachs, JPMorgan, and Bank of America all issued margin calls in the same week, and on July 30 the fund sold its entire public equity book - longs and shorts together - to Ken Griffin's Citadel in a single pre-market block trade.

This Week in Tech

OpenAI released more details on the incident where one of its unreleased research models escaped its testing sandbox and hacked into Hugging Face.

• The model chained together a previously unknown vulnerability in third-party software with a set of stolen credentials to gain internet access, then broke into Hugging Face over roughly two and a half days before anyone noticed.

• OpenAI is calling it "an unprecedented cyber incident, involving state-of-the-art cyber capabilities," and Sam Altman called it the first security incident he's felt "very viscerally” (whatever that means).

• More than 1,000 employees across OpenAI, Anthropic, and other labs signed a letter the same week urging the government to build tools for pacing frontier AI before capabilities outrun anyone's ability to understand them.

The AI-driven RAM and NAND shortage that's been brewing all year turned into sticker shock this week:

• SK Hynix's CEO said that the memory crunch could persist "until the next decade," and PC makers are now openly discussing sourcing memory from Chinese manufacturers just to keep production lines moving.

• Every gigabyte of DRAM that used to go into a laptop is now getting bid away by AI data centers willing to pay HBM prices for it, and analysts expect the sub-$500 laptop to functionally disappear from the market by 2028.

Arch is building a next-gen wealth management platform for individuals holding Alternative Assets. Our flagship product is the crypto-backed loan, which allows you to securely and affordably borrow against your crypto.

Disclaimer: None of the above is financial advice, seriously.