TEXITcoin, a Litecoin clone with a “decentralized” Texas secessionist brand identity, suffered a security breach, according to the man behind TEXITcoin, Bobby Gray, a guy obsessed with starting his own currency for the better part of two decades so as not to be beholden to the Federal Reserve.
Gray and his followers tout major sponsorships at blockchain summits, and they portray a lifestyle filled with Lamborghinis and stacked coins with stars in the middle, symbolizing the Lone Star of Texas, a binding article of faith among them.
TEXITcoin has an active community, and multitudes see TEXITcoin signage at Texas airports, gun shows, BBQ joints, crypto events, and on sports-related broadcasts. However, this shiny veneer masks a heavily centralized altcoin project with major security flaws and insufficient staff and capacity to course-correct.
This is the second in a series of three articles by Disruption Banking. The first investigated the technical staff of TEXITcoin, finding them mostly illusory. The third scrutinizes claims of sponsorship and mining with data centers, finding the claims highly inflated.
Gray’s Accidental Admission
On November 5, 2025, Gray offered the following admission during a YouTube Live “Miner Update”:
“This past week, we dealt with a major security risk. What happened? We had somebody with an administrator account that got compromised. somebody logged in, started sending out uh password reset emails. Those emails used to be accessible from the back end. So, you could actually find the link for the password reset. You could change a password for an account right there. Uh it happened about 4 or 500 accounts.
By “security risk” Gray probably means “security breach,” and a worrying one, at that.
TEXITcoin miners were reportedly all told to change their passwords. Disruption Banking obtained an image of an email from a Facebook group for TEXITcoin miners, one of whom received the email and was advising all other miners to reset their passwords.
On YouTube, Gray went on: “We went through, we tracked them all down. If we had to lock you out of your account to deal with the challenge, we’re very sorry and we apologize for that inconvenience. But we were able to catch the problem early because we’ve got a great notification system that tells people when their account has been accessed or changed. And so we caught it. You know, it’s going to cost us a couple thousand TXE out of pocket to make good on the people who had their their wallets compromised. Um, but this is what we deal with on a regular basis. And so we’re working hard over here.”
For those wondering about the scope of the funds, TXC is valued at -+$4.00 USD, so “a couple thousand TXC” is potentially +$10,000, if Gray’s estimate is to be believed.
The Man Behind TEXITcoin
Gray explains his motivation in an introductory video, “The problem was always money. And when I tried to find out who was behind the money supply, here in the United States, boy was I shocked and surprised to learn that the Federal Reserve is about as federal as Federal Express.”
In 2008, he launched his own currency and has been “manufacturing coins for the better part of 16 or 17 years,” to barter with other Texans. These are among the qualifications Gray offers to convince interested prospective investors to become a member of his project and buy his “decentralized” currency.
The picture emerging from last week’s security breach belies Gray’s claims of decentralization. Nevertheless, there’s an army of social media users who apparently have bought TEXITcoin or associated mining shares, and/or who are paid associates of Gray or perhaps, Gray himself.
Speak ill of TEXITcoin anywhere online, and users appear out of the woodwork to tell you about their “100% profit in a matter of weeks.” It’s a phenomenon, at least partially attributable to the allure of the founder who talks a decent game.
Bobby Gray introduces himself on the TEXITcoin site with the following, which perhaps best sums up the purpose of TEXITcoin: “Hi there! I’m Bobby Gray …and I’ve been manufacturing gold, silver, and copper coins for the past sixteen years.” He goes on a few lines later, “Young people today do not care about gold and silver. They care about cryptocurrencies, NFTs, and digital collectibles. If our children are the future, the future is crypto.”
In short, Gray is a noob and he’s counting on convincing other noobs to buy his cryptocurrency, hoping they won’t realize, according to one analyst, “It is basically the same project as hundreds or thousands of cryptos before it.”
Not The First Breach?
No media outlets seem interested in TEXITcoin, so most of the information available for netizens comes from social media, where rumors are rife.
One observer, Mista Phi, a crypto-focused YouTuber, drew attention to something Gray said in passing: “Those emails used to be accessible from the back end.”
Mista Phi warned investors in TEXITcoin in a video explaining the breach: “…Even administrators should not be able to get sensitive data… Those emails contain sensitive information, and he was keeping a copy of that on the back end. Now, he just said ‘they used to be.’ Well, this breach is fairly recent. Is that what you did to fix it so that this won’t occur again? These are the things that people need to know. These are things from a technical standpoint that should let everyone know that you are closing every door of opportunity to get exploited. And he’s not addressing that in this video.”
Gray’s statement suggests that reset links and email addresses were stored in an admin interface and accessible, pointing to weak access controls and possible data exposure, not just wallet risk, but personal info risk.
If accurate, the backend interface of TEXITcoin has been unsecured and unencrypted until last week, when hopefully that changed, but Gray doesn’t confirm that these vulnerabilities have been fixed.
Compounding the bad news for investors of TXC, a critic of TEXITcoin commented on a YouTube video explaining the poor security protocol leading to the breach.
“[TEXIT Raider] mentioned that a previous breach like this happened before, which further strengthens the fact that Bobby is a complete $%&*”. Clearly, he failed to implement measures to prevent this from occurring again, so he’s either %$&*£ or a participating culprit of the last breach. Neither is good.”
TEXIT Breach Takeaway
Disruption Banking was unable to track down the reference by TEXIT Raider, another YouTuber, about an earlier security breach. What’s clear is that TEXITcoin is extremely insecure.
Not only is it insecure, but the entire image is a facade: It is in no way decentralized. In decentralized cryptocurrency, typically, only users control their private keys. In TEXITcoin, insiders have easy access to them, and not even Gray has a handle on backend data vulnerabilities.
What investors should care about is that the breach was possible at all. An administrator account existed, password-reset links were viewable in the backend, and insiders had broad access to user information and potentially to user wallets. These are not the hallmarks of decentralized architecture; they are the vulnerabilities of a startup ‘Bobby-rigged’ with duct tape and patches.
For TEXITcoin investors, a good question for Bobby Gray, maybe in the next appearance on Youtube, would be, “How many accounts were compromised?” Ask for verification and ask every other investor you know if they received the “change password” email.
Did the malicious actor send all the users an email or just 500? Think about that. Did the attacker do it manually or harvest and exploit the data with software or AI? That should be explained.
Also, someone should ask what has been done to make sure this doesn’t happen again and whether this was an insider who carried out the exploit. A security investigator could be brought in to study and offer solutions so this doesn’t happen again.
A Billion-Dollar Coin?
For a project that markets itself with Lamborghinis and talk of becoming a “billion-dollar coin,” the breach is more than a setback. It should be a wake-up call.
In a video on August 28, Gray said, “We want to be good stewards of the trust and cash that you place with me. Follow through on a promise to build the mine, promote the coin, and pay out commissions in a timely manner. And that’s our winning formula.”
Notice that he said the cash is placed with “me,” and notice also that securing investors’ assets was not among his top three priorities.
Either Gray and his team rebuild TEXITcoin from the ground up with real technical leadership and transparency, or the project will remain what it appears to be today: a centralized, risky, and unsafe crypto experiment wrapped in secessionist branding.
Author: Tim Tolka, Senior Reporter
#Crypto #Blockchain #DigitalAssets #DeFi #TexitCoin #Texas
The editorial team at #DisruptionBanking has taken all precautions to ensure that no persons or organizations have been adversely affected or offered any sort of financial advice in this article. This article is most definitely not financial advice.
4 Responses
You don’t know what you’re talking about. I would think you have been involved as you did attend a ‘miners’ meeting which is for miners only. So you’re involved or someone added you which they will be suspended too. I’ve known him for the better part of almost 20 years. He has studied and been a part of Crypto learning from other Crypto experts what has gone wrong and what has worked. Your article has many holes in it sir, as well as twisted statements. You write as coming off as disgruntled and positioning information to gain a response. Perhaps knowing the inside as I do, he has a growing back office of which how would you know ALL of the experts involved inclusive of people living outside of our offices.. yes there’s 4 locally and still growing. Bobby is transparent, sharing the good, bad and learning from snafus for our team to initiate any change. He is generous…. What he gives back to the community through donations and sponsorships… all make a difference. There is so much you don’t know. EVERYONE has a mountain in front of them and a journey to take. Bobby is focused and we’re going not up the mountain but chopping a way to go through the mountain. It’s sad you can’t recognize it.
This is almost exactly what all of the paid “influencers” are writing on Reddit.
You have no idea what you are writing about. No wallets were hacked or breached.
Rather, payout addresses were changed for some of the miners. So the roughly $2 daily payout per mine, 4 mines each miner on average, over 500 payout addresses is about $4000. And this was easily covered, so there were no losses to anyone but Bobby.
Major trillion dollar institutions get hacked all the time. Recently Elon Musk suffered a data breech, and the employee took the information over to openai.
It’s as if you just learned that people steal. And do not know that crypto prevents theft better than anything else yet invented by man
The underlying TEXITcoin crypto did not get hacked.
Perhaps this is how the scam will ultimately unravel as tends to be the case in centralized projects. Since everything is under Bobby’s control, he sets up a fake hack where an “inside hacker” gains access to Bobby’s passwords & drains wallets and accounts and it’s all over. Then Bobby comes out and says, oops, sorry guys, we got hacked! Oh well. Thanks for buying me a big mine, precious metals, and real estate! Seriously, the website shows that they have one developer.