A cryptocurrency user suffered the loss of $3 million in Ripple company tokens, XRP. This was due to a critical error you made when importing the seed phrase from your cold wallet to a hot one.
The sequence of events unfolded with alarming rapidity. These stolen funds were transferred through the Tron network on October 12, 2025, according to the detailed tracking carried out by the renowned analyst ZachXBT.
Three days later, that is, on October 15, the total amount had already been completely laundered, through direct over-the-counter cryptoasset or OTC trading intermediaries (Over-The-Counter). These funds were distributed from addresses that maintain direct links to Huione, an online platform identified as a large-scale illicit marketplace, operating primarily in Southeast Asia.
Ellipal, the company behind the cold wallet that the user presumably thought he was using, explained their findings after conducting an investigation and establishing direct contact with the affected user.
In an official statement, Ellipal clarified that its findings “confirm that the loss occurred because the user mistakenly imported the seed phrase from his cold wallet into a hot one, making the assets accessible online.”
ZachXBT emphasized in its posts: “one lesson our industry needs to improve is not to cause confusion with products when they are offered both custodial and non-custodial.” With this he referred to the fact that XRP user believed he was trading cold wallet product of Ellipal while actually using a cryptocurrency hot wallet.
The analyst also expressed concern about the low probability of recovery of these funds. He attributes this, in part, to a delay in reporting the theft to specialized private sector experts, whose early intervention is crucial for effective action.
ZachXBT also highlighted Huione’s role. Regarding this, he noted that this entity has “directly facilitated the laundering of billions in illicit funds in recent years”, coming from complex deceptions such as “pig slaughter” scams, investment fraud, human trafficking and a variety of hacks or exploits in the Southeast Asian region.
It is relevant to mention that last week the government of The United States imposed additional restrictions against Huionein direct response to these criminal activities. As reported by CriptoNoticias, the government seized 127,000 bitcoin that remained in wallets linked to that criminal group.
The incident regarding stolen XRP funds reinforces the security warnings issued by Ellipal. The company urges all its users to “never import seed phrases from cold wallets into any hot or app-based wallet.”
Ellipal also recommends “keeping seed phrases and devices completely offline and separate.” For additional measures on how to protect yourself from fraud and scams, the CriptoNoticias Cryptopedia has educational articles with detailed explanations.
The company emphasizes that security education and user protection remain its top priorities. Recognizes that recovering stolen funds in the cryptocurrency ecosystem is a challenge, especially when criminals act so quickly to move and launder bitcoins and cryptocurrencies.