Is the cold wallet 100% safe? Be aware of two major scams that could leave your assets stolen!

A hardware Wallet is a physical device designed specifically for storing Crypto Assets, and is considered an important means of securely storing encryption assets. Its built-in secure chip stores the Private Key offline, ensuring that the user has complete control over the Crypto Assets. Hardware Wallets typically operate in an offline state, further reducing the risk of being targeted by online hackers.

However, in the situation where investors generally lack understanding, there are still a large number of fraud incidents targeting newbie users, leading to the loss of assets stored in hardware Wallet. This article will introduce two common coin theft methods for hardware Wallets - hardware Wallet instruction manual fraud and hardware Wallet modification disguised as eyewash.

Hardware wallet instruction manual fraud

The core of this type of coin theft lies in the ignorance of ordinary investors about the usage of hardware Wallet. By replacing the false instruction manual, the victims are misled into transferring funds to a phishing Address. The victims purchase the hardware Wallet from a third-party e-commerce platform, and after opening the package, they use the 'initial Pin code' labeled on the 'instruction manual' to open the hardware Wallet. After backing up the 'mnemonic phrase' printed on the 'instruction manual', they deposit a large amount of funds to the WalletAddress and ultimately suffer theft.

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The reason is not that the Wallet is cracked at the hardware level, but that the coin thieves obtain the Address mnemonic by activating it in advance, forge a false certificate for secondary packaging, and then sell the activated hardware device Wallet to the victims through unofficial channels. Once the target transfers encryption assets to the Address, it will enter the standard fake Wallet coin theft process.

Similar risks also exist in the secondary market in the Chinese-speaking region. Well-known hardware wallet manufacturer imkey has issued a warning that some unofficial stores are selling 'activated' hardware wallets while tampering with the user manual, deceiving users into depositing funds into Wallet Addresses created in advance by unscrupulous merchants. It is evident that identifying official e-commerce stores is as important as identifying official websites.

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Hardware wallet devices have been tampered with

A Ledger user received a package containing a brand new Ledger X hardware device Wallet and an accompanying letter without placing an order. The letter states that due to a cyber attack on Ledger, user data has been compromised, and therefore, new hardware device Wallets have been sent to affected customers, with a request in the letter for users to replace their devices to ensure security.

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However, the authenticity of this letter is questionable. Ledger CEO Pascal Gauthier explicitly stated that the company will not provide any compensation for the accidental disclosure of personal data. The user also stated that this is an eyewash, and shared more pictures showing the inside of the hardware device Wallet plastic box, which clearly has signs of tampering.

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In addition, the Kaspersky security team has also reported a case of counterfeiting the Trezor hardware wallet. The victim purchased a Trezor Model T through unofficial channels, but the device had already been replaced with internal firmware by the attacker, who was able to gain access to the user's encrypted assets and then engage in theft.

In conclusion

It is not difficult to see from the above cases that supply chain attacks on hardware wallet have become very common. Ordinary investors and hardware wallet manufacturers should be vigilant about this. Using it correctly can effectively avoid the risk of coin theft:

Purchasing hardware devices through official channels ensures the security of any hardware Wallet. Hardware devices purchased through unofficial channels are not secure.

Make sure the Wallet is in an inactive state. The hardware device sold by the official must be in an inactive state. If the investor finds that the machine has been activated after turning it on, or if the manual prompts for an 'initial password' or 'default Address', please disable the device in a timely manner and provide feedback to the official of the hardware device Wallet.

Ensure that the Address is generated by the user. Except for the device activation process, setting PIN, generating binding code, creating Address, and backup should also be done by the user. Any operation by a third party will bring financial risks to the user. Normally, the hardware Wallet device should be in an unactivated state, that is, when using the hardware Wallet device for the first time, the user should activate the device, create the Wallet, backup the mnemonic, and set the PIN code by themselves.

【Disclaimer】The market is risky, and investment should be cautious. This article does not constitute investment advice. Users should consider whether any opinions, perspectives, or conclusions in this article are in line with their specific circumstances. The responsibility of investment lies with oneself.

This article is authorized to be reproduced from: 'Foresight News'

Original author: Bitrace