Robinhood Founder's Seed Phrase Leak Pumps Memecoin to $14M

A leaked recovery phrase from a Robinhood founder's wallet let a hacker pump a memecoin from $500,000 to $14 million in just two hours, exposing how copy-traders who follow large wallets without verification can be exploited.

Michael, chief business officer of TokenPocket wallet, posted details on X on July 13. Bitget's news desk later cited his account. The attacker accessed a wallet holding about $1.5 million after the founder's 12-word mnemonic was accidentally shown during a live broadcast, Michael said.

Using that address, the attacker bought the "$1" token. Thousands of onlookers monitoring the wallet interpreted the purchases as a signal from the founder and followed, driving the token's market value nearly 28 times higher before the buying stopped and the price collapsed. Two-hour trading volume exceeded $20 million, Michael wrote.

Robinhood's remote procedure call (RPC) service blocked the compromised address, preventing further outflows from the wallet, Michael said. The node stopped processing any transaction from that address. By the time the block took effect, the attacker had already moved funds to the BNB Chain, created a new token, and executed wash trades to inflate volume and cash out.

The incident mirrors broader patterns of on-chain manipulation. Suspected wash trading totaled roughly $2.57 billion across blockchains studied in 2025, per Bitget data, using matched-trade detection rather than proof of intent. The "$1" run followed a similar playbook: exploit a trusted signal, draw copy-traders, and exit through a separate chain.

Bitcoin held near $62,800 and Ether at $1,778 on July 13, both little changed. The event was isolated to the memecoin but demonstrated a tactic that could be applied to any chain, Michael said. Traders who follow wallet activity without verifying ownership risk similar losses.

Robinhood's guidebook on recovery phrases warns users that a seed phrase is the only backup for a non-custodial wallet and that sharing it gives anyone full access to the funds. Live streaming is one of the most public ways a phrase can be exposed, the company notes.