Security archive
Hardware wallet security incidents
A comprehensive, chronologically tracked history of security breaches, physical attacks, phishing campaigns, and supply-chain exploits across all major hardware wallet brands. Updated August 2026.
All incidents, latest first
Seed-generation entropy flaw — ~594 BTC swept from dormant wallets
Following a 2021 cryptographic library migration, Coldcard's BIP-39 seed generation was silently linked to MicroPython's software PRNG instead of the hardware TRNG. Effective entropy collapsed to roughly 40 bits on Mk3 (and ~72 bits on Mk4/Mk5/Q), making generated seeds reconstructible by brute force. On July 30, 2026 an attacker swept the highest-value single-sig balances first — about $30M in the opening ten minutes.
- Impact
- Galaxy Research traced ~1,083 BTC across 1,196 addresses; Chainalysis confirmed ~594 BTC (~$38M) leaving ~500 dormant addresses in ~25 minutes. PeckShield attributed ~$70M of July 2026 losses to the flaw — the third-largest crypto theft of the year.
- Status / Countermeasure
- Coinkite advisory published July 30, 2026. Fixed firmware released for every affected model (Mk2/Mk3 4.2.0+, Mk4/Mk5/Q 6.6.0+). Seeds created on affected firmware are at risk unless generated with 50+ private dice rolls or protected by a strong, unique BIP-39 passphrase — affected users should generate a new seed and migrate.
Phishing campaigns impersonating SafePal Support
Fake SafePal Telegram, X and email accounts routinely solicit seed phrases under the guise of support tickets.
- Impact
- Affects users who share their seed. Not a device flaw.
- Status / Countermeasure
- User-education problem industry-wide.
Postal-mail phishing letters impersonating Ledger
Threat actors mailed physical letters on forged Ledger letterhead — complete with holograms, reference numbers and executive signatures — demanding recipients complete a mandatory 'Authentication Check' by scanning a QR code. The linked site harvested 24-word recovery phrases. Trezor owners received near-identical letters in the same wave.
- Impact
- Targeting appears to reuse addresses from old customer-data leaks. Any user who entered a recovery phrase lost full control of the wallet.
- Status / Countermeasure
- Ledger reiterated it never requests recovery phrases. No fix possible beyond user awareness — leaked address data cannot be recalled.
Postal-mail phishing letters impersonating Trezor
The same snail-mail campaign that hit Ledger owners mailed forged Trezor 'security and compliance' letters with QR codes leading to recovery-phrase harvesting sites, styled as a mandatory firmware or transaction check.
- Impact
- Recovery-phrase theft for anyone who scanned and complied.
- Status / Countermeasure
- SatoshiLabs warned users publicly. Mitigation is awareness only.
Fake 'Trezor Value Wallet' support scam — $282M drained
Attackers impersonating Trezor support for a fictitious 'Value Wallet' service talked a single holder into revealing their recovery phrase. ZachXBT reported the wallet was drained within minutes and the funds scattered across chains and swapped into Monero.
- Impact
- ~1,459 BTC (~$139M) and ~2.05M LTC (~$153M) stolen — about $282M total, the largest social-engineering theft ever recorded against an individual.
- Status / Countermeasure
- No device or firmware flaw involved. Funds unrecovered; laundering traced by ZachXBT and ZeroShadow.
USPS letter campaign tied to the 2020 customer-data leak
Ledger customers received letters by USPS instructing them to 'validate' their wallet via a QR code or lose access. The letters carried accurate personal details, strongly suggesting the 2020 e-commerce database leak as the source list.
- Impact
- Recovery-phrase theft for anyone who complied. Individual losses not publicly aggregated.
- Status / Countermeasure
- Ongoing risk. Ledger maintains a public list of active phishing campaigns.
CONNECT smart-contract approval bug
A vulnerability in Ledger's CONNECT smart contract allowed unauthorized token approvals to be set on behalf of users in narrow conditions.
- Impact
- Roughly $484K of user funds at risk; Ledger and white-hat groups recovered the bulk of it.
- Status / Countermeasure
- Patched. Post-mortem published.
Third-party support portal breach (~66K users)
An attacker accessed a third-party customer-support tool used by Trezor and contacted ~66,000 users who had opened support tickets, posing as Trezor staff in phishing attempts.
- Impact
- No funds reported lost. Email addresses and ticket contents exposed.
- Status / Countermeasure
- Disclosed by Trezor within 24 hours. Vendor access revoked.
Connect Kit supply-chain attack (~$600K drained)
A former Ledger employee was phished, giving the attacker push access to Ledger's NPM account. A malicious version of @ledgerhq/connect-kit was published and pulled in by hundreds of dApps (Sushi, Zapper, Revoke.cash, Kyber, etc.), injecting a wallet drainer into their front-ends.
- Impact
- Roughly $600,000 stolen from users who connected any wallet (not just Ledger) to affected dApps during the ~5-hour window. Hardware devices themselves were untouched.
- Status / Countermeasure
- Malicious package removed within hours. Ledger pledged to reimburse affected non-Ledger users and tightened internal NPM/2FA practices.
Unciphered extracts seed from Trezor T via voltage glitching
Security firm Unciphered published a video showing physical extraction of the seed from a passphrase-less Trezor T by glitching the STM32 chip. Requires physical possession, lab equipment and a few hours.
- Impact
- No remote risk. Anyone storing significant funds on a Trezor One/T without a strong passphrase is vulnerable if the device is lost or stolen.
- Status / Countermeasure
- Mitigation: BIP-39 passphrase. Cannot be patched on existing devices — chip is not a Secure Element. Trezor Safe 3 / Safe 5 add a Secure Element to address this.
Ledger Recover key-shard backup controversy
Ledger announced an optional subscription that would let the Secure Element split and encrypt the seed into three shards held by Coincover, Ledger and EscrowTech for ID-based recovery.
- Impact
- No funds lost, but the disclosure that signed firmware can extract seed-derived material if the user opts in undermined the long-standing 'the seed never leaves the device' marketing and triggered a major trust crisis in the community.
- Status / Countermeasure
- Feature shipped as opt-in. Open-sourcing of more device code committed in response.
Unciphered — physical seed extraction from OneKey Mini
Unciphered demonstrated that the OneKey Mini's microcontroller could be glitched to dump the encrypted seed; the PIN could then be brute-forced offline.
- Impact
- Requires physical access. No remote exploit.
- Status / Countermeasure
- OneKey shipped a firmware patch that hardened anti-glitching countermeasures and later moved newer models to a Secure Element (OneKey Classic 1S, Pro).
Mailchimp breach → mass phishing campaign
Attackers compromised Trezor's Mailchimp newsletter list and sent emails directing users to a fake 'Trezor Suite' download that asked for the seed phrase.
- Impact
- Unknown number of seed phrases harvested; multiple wallets drained.
- Status / Countermeasure
- Mailchimp account locked. Trezor migrated email infrastructure.
E-commerce database breach (~1M emails leaked)
An attacker exploited an API key on Ledger's marketing site and exfiltrated roughly 1 million email addresses, plus ~272,000 detailed records including names, postal addresses and phone numbers of customers who had ordered hardware wallets.
- Impact
- The dataset was dumped publicly on RaidForums in December 2020. Customers were targeted with waves of phishing emails, SMS smishing and even physical threats sent to their home addresses. Hardware wallets and seed phrases were never compromised, but real-world safety of holders was.
- Status / Countermeasure
- Acknowledged. Class-action settled in 2024. Database remains in circulation.
Kraken Security Labs — STM32 voltage-glitching disclosure
Kraken Security Labs detailed a $75 attack against the Trezor One and Model T using voltage glitching to bypass read protection and recover the encrypted seed.
- Impact
- Same as above — physical possession required, mitigated by a strong passphrase.
- Status / Countermeasure
- Acknowledged. Same mitigation path.
Kraken Security Labs voltage-glitch attack
Kraken Security Labs showed that a stolen KeepKey could be glitched to extract the encrypted seed in about 15 minutes for under $75 in equipment.
- Impact
- Physical theft scenario only. Passphrase mitigates.
- Status / Countermeasure
- No silicon-level fix possible on existing units. ShapeShift recommends using a BIP-39 passphrase.
What the history actually shows
- No hardware wallet has ever had its seed extracted remotely. Every successful key-recovery attack to date has required physical possession of the device.
- The biggest losses come from supply chains and phishing, not from chips. The Connect Kit attack and Ledger/Trezor/Mailchimp phishing waves account for far more user losses than any silicon-level exploit.
- Secure Element matters for physical attacks. Every demonstrated physical seed-extraction has targeted devices without a certified Secure Element (legacy Trezor, KeepKey, OneKey Mini). A BIP-39 passphrase mitigates these attacks on existing hardware.
- Your data is part of your threat model. The 2020 Ledger leak proved that buying a hardware wallet from a retailer that handles customer addresses introduces a real, non-cryptographic physical-safety risk.
Compare wallets by what actually went wrong
Our hardware wallet comparison weighs Secure Element design, air-gap, open-source status and shipping/data practices — not just specs.
See the full comparison →Sources include vendor post-mortems, Unciphered and Kraken Security Labs public disclosures, Ledger and Trezor official statements, court filings and chain-analysis reports. This page tracks publicly disclosed incidents only — it is not exhaustive of internally patched bugs.