Researcher Reports Flaw in Cake Wallet That Could Divert Bitcoin Payments

• According to the report, it would affect Bitcoin wallets in versions 6.4.4 and 6.5.0.
• The alleged attack requires a malicious server or an intermediary on the network.

A security researcher who goes by "floppy" published a report on October 24 regarding a supposed flaw in Cake Wallet, an open-source mobile wallet. According to the report, the flaw would allow the diversion of Bitcoin payments to an attacker when the user accelerates a pending transaction. The company has not commented on the report.

The scenario described by the researcher is concrete: the user sends Bitcoin, the transaction remains unconfirmed, and decides to pay more to have it processed sooner. This function, called RBF (Replace-By-Fee), creates a copy of the transaction with a higher fee that replaces the original.

According to the report, to create that copy, Cake Wallet does not use its own records. It requests the data from an Electrum server, the remote node to which the app connects to query the network without downloading it completely. The researcher claims that the app would not verify that what it received matches what it requested.

In simple terms, it would be like asking a third party for a copy of a check to reprint and sign it without checking the name of the payee. If the server changed the recipient's address to its own, the wallet would still sign it, and the payment would end up in the hands of the attacker.

Who Could Exploit It, According to the Report

The researcher identifies two profiles of attackers. The first would be the one operating the server that the app uses. It could be Cake Wallet's default node, a third-party one, or a custom one chosen by the user.

The second would be an intermediary on the network, for example, on a public Wi-Fi. The author states that this is possible because the app would accept any security certificate, meaning it would not verify that the server is who it claims to be. According to the same report, Cake's integrated Tor mode does perform that verification, so that route would be closed.

The researcher adds that the user would have no way of noticing. If the server responds honestly to the first query and alters the subsequent ones, the confirmation screen would show the same as a legitimate acceleration.

What Remains to Be Confirmed

The report includes a proof of concept that, according to the author, was executed on a local Bitcoin test network. In that environment, it claims, the forged replacement was accepted and confirmed, with the payment sent to the attacker's address.

However, the author clarifies that he did not execute it against the app installed on a device. There are also no records of thefts, although his post on X speaks directly of "theft via RBF." For now, the flaw has not been verified by third parties nor acknowledged by Cake Wallet.

The author also stated that he used artificial intelligence tools to investigate the flaw, create the proof, and draft the report. This fact makes an independent review of the report even more relevant before it can be deemed valid.

The case has a contrast. Following a recent theft that affected another wallet, Cake stated in its official forum that it has been auditing that type of code for years. It also said that it has intensified those reviews with AI models.

Another nuance is the timeframe. The researcher published the report five days after sending it and accused the team of being more focused on marketing. This margin is much shorter than the usual 90 days for the responsible disclosure of vulnerabilities.

Precautions in the Meantime

The report suggests that the app verify that the received transaction corresponds to what was requested and displays on-screen what it is actually going to sign. While Cake Wallet does not comment, users who want to be cautious can:

• Avoid the bump fee option for pending transactions.
• Activate the app's Tor mode.
• Connect to a personal or trusted Electrum server.

Regardless of how the case ends, the report reminds that a lightweight wallet relies on external servers to view the network, and that every piece of data it does not verify is a piece of data it trusts. If the flaw is confirmed, the weakness would not lie in the cryptography, but in that trust.

This content is provided for general informational purposes only and doesn't constitute financial, investment, legal, or tax advice. Any events, rewards, online promotions, or related information mentioned herein should not be considered a recommendation, solicitation, or invitation to purchase, sell, trade, or otherwise deal in any crypto assets. Crypto assets are highly volatile and may result in loss. The availability of WEEX services, products, and related events may vary by region. You are responsible for ensuring that your participation is in accordance with applicable local laws and regulations.