Hardware Wallet Tampering Leads to Over $90 Million in Crypto Theft
An organized criminal network intercepted and modified physical cryptocurrency wallets made by Ledger, leading to an estimated theft of more than $90 million. Attackers acquired authentic devices, inserted custom mobile communications chips and SIM cards, and resold them in Southeast Asia. When users set up the tampered devices, hidden components captured their wallet recovery phrases and sent them over cellular networks, enabling criminals to access and drain the funds.
The incident highlights critical supply chain vulnerabilities for cryptocurrency investors who rely on offline hardware for security. Although Ledger confirmed its internal security chips, operating system, and servers remained uncompromised, altered devices were still able to pass standard authenticity verifications. Retail outlets in Malaysia and Singapore distributed the altered devices before the breach was identified.
Ledger has instructed official partners across Southeast Asia and Hong Kong to halt sales while working with local police. The company is banning the resale of returned hardware and introducing stricter storage controls. Meanwhile, Bitcoin (BINANCE:BTCUSDT) traded at 82,250 USDT, up 0.93% for the day. Investors and distributors are watching for further updates from law enforcement and potential security updates to authentication checks.
Key points
- Attackers modified genuine Ledger hardware wallets with hidden cellular chips to intercept secret setup phrases and steal over $90 million in assets.
- The internal security chips and operating system were not hacked, but the altered hardware still passed standard authenticity verifications.
- Ledger suspended regional device sales in Southeast Asia and Hong Kong while implementing strict new controls on returned units and storage.
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How we writeDisclaimerQuestions and answers
How did attackers steal funds using hardware wallets?
Criminals inserted hidden mobile communication chips into authentic devices to capture recovery phrases during setup and send them to an external server.
Were Ledger internal security chips or servers hacked?
No, Ledger reported that its security chips, operating system, and servers remained secure, but altered devices bypassed initial authenticity checks.
What steps are being taken to address the hardware breach?
Sales have been suspended in Southeast Asia and Hong Kong, resale of returned devices has been banned, and law enforcement is investigating.