El Salvador’s State-Controlled Bitcoin Wallet Faces Second Data Breach

El Salvador’s state-controlled Bitcoin wallet is facing another data breach incident as hackers have leaked sensitive information once again. On April 23, anonymous bad actors known as CiberInteligenciaSV shared some of Chivo’s source code and VPN credentials for state-operated Bitcoin (BTC) ATMs in El Salvador on BreachForums, a platform for criminals and malicious hackers.

CiberInteligenciaSV stated, “This time I bring you the code that is inside the Bitcoin Chivo Wallet ATMs in El Salvador. Remember that it is a government wallet, and as you know, we do not sell, we publish everything for free for you.”

Prior to the incident, digital security startup VenariX had warned citizens and the broader crypto community about an impending Chivo leak. CiberInteligenciaSV had teased the forthcoming BreachForums post on its Telegram Channel and even invited government officials to negotiate.

Chivo is the official Bitcoin storage solution provided by the government of El Salvador. It became a national tool after President Nayib Bukele officially adopted Bitcoin as legal tender in September 2021, making El Salvador the first country to do so worldwide.

Salvadorans can use Chivo to buy or sell Bitcoin, as well as withdraw cryptocurrency from BTC ATMs across the country. However, users reported issues with the wallet shortly after its launch, including slow execution, app crashes, and bugs.

To address technical glitches, the government partnered with U.S. white-label software firm AlphaPoint. The situation escalated earlier this month when personal information of around five million Salvadorans was exposed online. The 144GB leak, extracted from a former national security advisor named Alejandro Muyshondt, included details like full names, dates of birth, profile photos, and addresses. Experts later linked the files to Chivo sign-up requirements, although Bukele’s administration has not commented on the incident.

In related news, El Salvador recently moved $386 million worth of Bitcoin into cold storage.

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