Walking canes provide a suitable placement for inertial gait analysis systems such as gait velocity estimation. However, previous velocity estimation methods such as the Zero Velocity Update (ZUPT) method, which are designed for foot mounted inertial sensor systems, are not suitable for walking canes. In this study, we propose the use of a modified velocity update method based on the inverted pendulum model to improve the gait velocity estimation of cane users. The results showed that the proposed method resulted in lower Root Mean Square Error (RMSE) values than the ZUPT method for the estimation of the cane velocity, but the results were worse than previous foot mounted systems.