SlowMist Security Chief Information Security Officer 23pds stated that if the modification of the Ledger device PCB is as described by former Mt. Gox CEO Mark Karpelès, then the attacker would possess a considerable level of technical skill.

The attack process may be: the wallet generates the mnemonic phrase within a secure element (SE), then displays the mnemonic on the screen for the user to write down; a malicious module retrieves the displayed content through screen data lines such as SPI, records the complete mnemonic, and then sends the data to the attacker via LTE/eSIM, ultimately leading to the theft of user assets.

The role of the secure element is to prevent the private key from being directly read or exported, but it cannot stop external modules from obtaining the information currently displayed on the screen. The above analysis is based on the premise that the PCB has indeed been modified as described, and the relevant attack paths and hardware implantation still require independent verification.

Karpelès previously disclosed that a Ledger hardware wallet he received appeared to have a spy module implanted. The device came from Malaysia, the outer packaging was intact, and it was difficult to immediately detect abnormalities after opening, as the implant was hidden in the position where the screen's original cushioning pad should be.

Karpelès further explained that the module contains LTE communication components, an antenna, an eSIM, and a microcontroller connected to the Ledger SPI bus, which can analyze the characters displayed to the user and send relevant data after the mnemonic setup is completed. The SPI bus is the channel through which Ledger transmits display data to the screen.

This module may still pass genuine device verification since it does not directly contact the secure element and firmware. Karpelès stated that he will further analyze the SIM card and microcontroller within the module, including extracting firmware. Currently, Ledger's official investigation is ongoing, and the relevant hardware implantation has not yet been independently confirmed.

If the attack path is valid, funds could be remotely transferred after the user completes the mnemonic setup, with the parties under pressure being users who purchased the device through suspicious channels and the trust in the hardware wallet supply chain, while the beneficiaries would be the attackers who possess the mnemonic.

Source: Public Information