- The wrench attacks have intensified as the value of Bitcoin has increased, and the attackers have taken their assault to the physical level of crypto investors
- Both centralized and MPC custody solutions provide more than regular cold wallet security.
- Regulatory bodies and individuals working with personal security firms are transforming crypto safety standards through increased clarity and active engagement.
Crypto investors are flocking to centralized custodians in record numbers as wrench attacks, which are violent physical assaults aimed at stealing cryptocurrency, keep on the rise worldwide. Such criminal activities include forcing the victims to provide their own keys or authorize transfers by blackmail or physical violence, revealing the key weakness of self-custody with cold wallets.
A rapid rise in the number of wrench attacks in 2025 has already led to the growth of demand in institutional crypto custody services. Chainalysis indicates that there have been 35 wrench attacks already this year, close to doubling the prior high in 2021. Crypto owners are already attractive targets, and the fact that Bitcoin’s price has risen to over $122,000 just makes things worse. A rising and global threat has been documented by Bitcoin enthusiast and Casa CTO Jameson Lopp, who keeps a GitHub repository of hundreds of similar physical attacks since 2014.
Violent Crimes Spur Demand for Custody Services
Recent high-profile cases have spotlighted the danger. In early 2025, kidnappers abducted Ledger co-founder David Balland and his partner, holding them for ransom and cutting off one of his fingers to force submission. Armed bandits also abducted the daughter and grandson of a crypto CEO in broad daylight in Paris. These bold attacks are making investors re-examine the adage of not your keys, not your coins to a centralized custody solution that may increase the security of coins beyond the control of the individual.
According to Emma Shi, OTC and institutional sales director at HashKey, there is more interest, especially among wealthy retail investors and family offices, who want regulated custodial solutions to these violent episodes. She added that a spiking retail anxiety is turning into significant inflows as funds are being invested to safeguard assets and themselves.
Wade Wang, CEO of MPC custody provider Safeheron, describes the lack of protection of cold wallets because of a single point of failure risk. He promotes multisignature and multiparty computation (MPC) systems, which spread control among multiple parties in a way that unauthorized access is much harder. Nevertheless, centralized custodians provide some necessary security, such as time locks and multi-level approvals, increasing the cost and complexity of the operations made by an attacker.
The Shifting Crypto Safety Paradigm
A physical risk of wrench attacks reinforces reconsideration of crypto safety by investors. Being exposed to the dangers of physical coercion, a great number of people are transferring the assets to institutional custodians or to distributed custody service providers to render the attacks economically and practically impossible. Making the theft more expensive in the millions, according to Wang, will keep attackers at bay.
Also, the cryptocurrency owners, as soft physical targets, are no longer popular with people. According to Shi, you are less likely to be attacked opportunistically when you are aware that there is more crypto stored in custodial solutions. The current regulatory trend in the US, EU, and other jurisdictions is codifying custody structures, allowing institutional access, and mainstreaming professional custody to wider retail investors.
Phil Ariss of crypto tracing company TRM Labs points out that wrench attacks are an aggressive adaptation of the old school criminal methods to the world of crypto money. These offenses are different from cyberattacks because they attack human weakness by either direct violence or intimidation in order to overcome sophisticated encryption.
The rich investors are now using personal security guards and companies to combat physical attacks. In the meantime, the improved law enforcement cooperation and stricter regulations are likely to increase the expenses of the offenders and decrease the wrench attacks with time.
This wrench attack boom reveals the continued growing pains of the crypto business in its quest to become a part of financial life. Although decentralized control is in line with the blockchain spirit, investors are increasingly attracted towards centralized and distributed custody services that can protect assets and lives.
