Update (Dec. 31, 12:40 pm UTC): This article has been updated to include Tangem’s statement to Cointelegraph on the security vulnerability, the fix, and its handling of the situation.
Cryptocurrency wallet provider Tangem has fixed a critical security vulnerability in its mobile app that collected certain users’ private keys via emails. The fix came after Redditors repeatedly called out Tangem for putting investors’ funds at risk by exposing their private keys on email accounts and to Tangem employees.
The Incident
On Dec. 29, a Reddit discussion on Tangem’s operations gained traction, claiming the wallet provider allowed private keys to remain on email histories. The Redditor, u/areklanga, added that Tangem had not provided a ‘sensible reaction’ when the issue was pointed out earlier.
"So, user private keys remain in both user email history, Tangem email history, and perhaps in some Tangen employees. Which makes all Tangem users compromised."
The Redditor also claimed that the original Reddit post mentioning the glitch "was deleted for some reason."
Tangem’s Response
Tangem acknowledged the issue on Dec. 30 and said the incident arose from a bug in the mobile app’s log processing, which had been ‘fully resolved.’ Tangem provided a breakdown of the situation:
"What was the issue? When creating a wallet with a seed phrase, the private key was mistakenly logged in the application’s logs. These logs could later be accessed during interactions with our support team."
Tangem got a new update on Dec. 30. Source: Google Play
According to the company’s Reddit post, the bug affected a small group of users, and they are being contacted proactively for caution and support:
"It could have affected a very limited group of users: specifically, those who used a generated seedphrase, then immediately submitted a support request through the app. It does not affect any other users."
The Scope of the Vulnerability
In a statement sent to Cointelegraph, Tangem confirmed that the vulnerability was limited to fewer than 0.1% of users under specific circumstances:
"Only users who activated wallets with a seed phrase and contacted support within seven days of activation were potentially affected. Users without seed phrases or those who did not reach out to support through the app were unaffected."
Tangem also stated that no private keys were compromised, no user funds were lost, and no unauthorized account access occurred.
Transparency and Additional Measures
Tangem confirmed in its Reddit response that "all logs and attachments sent to its support team were permanently deleted, ensuring no residual data remains." Tangem has also implemented several additional measures, including:
- Enhanced security protocols
- A proactive outreach program to notify affected users with clear instructions and support
- A bug bounty program to identify vulnerabilities in exchange for rewards
The Crypto Community’s Reaction
While Tangem pushed out an update on Dec. 30 to prevent further leaks of seed phrases, some crypto community members called out the wallet provider’s muted response. However, Tangem told Cointelegraph that it had communicated directly with affected users and handled the issue transparently.
Tangem had not made any announcements on its social media channels, Twitter, Discord or Telegram, at the time of publication on Dec. 31. However, all Tangem users are advised to immediately update their mobile applications to avoid potential seed phrase leaks.
Conclusion
The incident highlights the importance of security in cryptocurrency wallet providers and the need for timely bug fixes. While Tangem’s response has been criticized by some members of the crypto community, the company has taken steps to address the issue and enhance its security protocols.
In a rapidly evolving industry like cryptocurrency, it is essential for companies to prioritize transparency and user safety. By doing so, they can maintain trust with their users and continue to innovate in the space.
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- Tangem’s official website, which logs all version updates of its mobile application, did not mention the details about the Dec. 30 update at the time of publication.
