A recent court case has revealed a shocking incident involving 3 engineers who were convicted of stealing over 19,487 digital wallet credentials. These individuals used a backdoor to gain access to the popular iToken application, compromising users’ private keys and mnemonics from March to May 2023. This breach highlights the vulnerability of digital wallet systems and raises concerns about the security practices employed by companies like iToken. The court has sentenced all three engineers to three years in prison and imposed a significant financial penalty. 27,622 mnemonics and 10,203 private keys were compromised during this unauthorized data acquisition. While the iToken community is yet to address the incident publicly, a lack of official response adds fuel to concerns regarding the company’s commitment to safeguarding user privacy. A significant impact on the crypto market has been observed with Ethereum’s price dropping 3.81% over 24 hours following this news.