A security researcher operating under the pseudonym "floppy" published a report on October 24 alleging that Cake Wallet, an open-source mobile bitcoin wallet, contains a flaw that could allow an attacker to redirect bitcoin payments when a user accelerates a pending transaction using the Replace-By-Fee (RBF) mechanism. Cake Wallet has not responded to the report, and the claim remains unverified by independent third parties.
According to the report, the problem lies in how Cake Wallet builds a replacement transaction when a user chooses to "bump" the fee on a payment that has not yet confirmed. Rather than relying on its own transaction records, the app requests data from an Electrum server to construct the replacement. The researcher alleges that the app does not verify that the data it receives actually matches what it requested, leaving room for manipulation.
Two categories of attacker could exploit this, per the report: whoever operates the Electrum server the app connects to — whether the default server, a third-party node, or even a custom one chosen by the user — or a network intermediary positioned between the user and that server, such as someone monitoring traffic on public wifi. The report also states that the app accepts any security certificate presented to it without verifying the server's identity, which would make the network-intermediary scenario feasible. Cake Wallet's built-in Tor mode is described as an exception, since it reportedly does verify the server and would close off that particular path.
Floppy noted that a user would have no way of detecting the manipulation if the malicious server answered truthfully on an initial query and only altered data on a later one, making the attack difficult to notice in practice.
Proof of concept and limitations
The report includes a proof of concept the researcher says was run on a local Bitcoin test network, in which a fraudulent replacement transaction was accepted and confirmed, sending the payment to an address under the attacker's control. The researcher acknowledged a limitation: the proof of concept was not executed against the Cake Wallet app actually installed on a device. Floppy also said artificial intelligence tools were used to investigate the flaw, build the proof of concept, and write up the report. There are no records of actual thefts linked to the issue.
Disclosure under five days, not ninety
The researcher published the findings five days after sending them to the Cake Wallet team, well short of the roughly 90-day window typically associated with responsible disclosure practices. Floppy accused the team of being more focused on marketing. In a social media post summarising the issue, the researcher described it simply as "theft via RBF."
The report proposes that the app should verify that any transaction it receives from a server matches what it originally requested and should display on screen exactly what it is about to sign before the user confirms. In the meantime, the researcher and Cake Wallet materials both point to precautions users can take: avoid using the "Bump fee" option on pending transactions, activate the app's integrated Tor mode, or connect to a personal or otherwise trusted Electrum server rather than a default or third-party one.
The disclosure comes after Cake Wallet stated on its official forum, in response to a recent theft affecting another wallet, that it had audited that category of code for years and had intensified its reviews using AI models. The company has not yet addressed the specific claims in floppy's report.
