Security researcher Joe Grand says it’s unrealistic to expect most cryptocurrency holders to spot sophisticated tampering with hardware wallets—particularly when attackers can compromise devices through the supply chain. Speaking to Cointelegraph on Tuesday, Grand described how past work has included recovering funds from locked wallets and analyzing methods to bypass hardware protections and pull data from the memory chips used in devices made by Trezor and KeepKey.
The comments arrive amid renewed scrutiny of hardware-wallet distribution after Ledger reported unauthorized implants in at least one affected device sold through CryptoBilis, a reseller described by Ledger as authorized in Indonesia, Malaysia and the Philippines. Ledger confirmed Saturday that a device contained an unauthorized implant, and said the malicious hardware captured users’ recovery phrases and transmitted them over cellular networks.
Key takeaways
- Grand argues that even skilled users can’t realistically detect advanced physical tampering on every device they buy.
- Ledger reported that cellular-capable implants captured recovery phrases from compromised devices sold via CryptoBilis.
- Trezor says its devices include authenticity checks and signed firmware, but acknowledges these measures can’t fully eliminate physical modification risk.
- Security experts emphasize that improving device design can make attacks harder, but cannot remove supply-chain trust entirely.
- Companies appear to be responding by tightening reseller footprints and reconsidering distribution controls.
Why ordinary users can’t “inspect away” supply-chain attacks
Hardware wallets are often marketed as a shield against the most common online threats, since private keys are kept offline. But the risk profile changes once you consider how devices enter consumers’ hands. Grand highlighted a fundamental problem: detecting high-end tampering isn’t something most owners can do reliably, even if they’re technically capable.
“It’s really hard to explain to people how they’re supposed to look at their devices, because even technical people like me are not looking at every single device to see if it’s been tampered with,” Grand told Cointelegraph.
That framing matters because the Ledger incident centers on physical compromise rather than a software-only vulnerability. If attackers can alter or add components after manufacturing—whether in storage, shipping, or retail handoffs—then surface-level checks may not be sufficient to rule out compromise.
Control can be distributed, but trust can’t
Hardware wallets can reduce exposure to malware and phishing, yet their security ultimately depends on multiple actors: the manufacturer, the supplier network, and the reseller or handlers before the device reaches the user.
Coin analyst Mati Greenspan told Cointelegraph he has never personally used a hardware wallet, despite involvement in the industry since 2013. His reasoning was less about distrust of cryptography and more about skepticism toward adding yet another “chain of trust.”
“When you buy a hardware wallet, you’re introducing a whole new chain of trust, from the manufacturer to the supplier to whoever handled the device before it reached you,” Greenspan said.
Casa CEO Nick Neuman reinforced a similar point: avoiding third-party intermediaries entirely is not feasible. “There is always an intermediary you will need to trust,” he said. In his view, a practical approach is to reduce single-point dependence—spreading risk rather than relying on one provider or pathway.
Authenticity checks and signed firmware aren’t a complete solution
Trezor—one of Ledger’s prominent rivals—said its devices undergo authenticity checks and only accept signed firmware. However, the company acknowledged that these steps do not guarantee the absence of physical tampering.
A Trezor spokesperson told Cointelegraph that users can check packaging integrity and holographic seals and look for unusual device marks, but “these checks alone cannot guarantee that it has not been modified.”
In the Ledger case, the specific threat described by Ledger is not merely a firmware swap. Ledger said the implants found in compromised devices could capture information displayed on the screen, while operating without the kind of firmware modification that typical signed-update workflows might catch.
Trezor separately said it has not observed this type of attack on its own devices. Still, it appears to be taking preventative action: on Tuesday, Trezor announced it would reduce the number of resellers as a “preventive” step.
For users, this highlights an uncomfortable gap in the defense model. Many consumers understand hardware wallets as “secure because firmware is verified.” Yet if the attack path includes added components that can observe or exfiltrate data, then cryptographic verification alone may not address the threat.
What device design changes could—and could not—do
Grand suggested that hardware wallet manufacturers can make certain tampering strategies materially harder. Among the ideas he discussed were design changes that either make the internals more visible for inspection or, conversely, use tamper-resistant enclosures that would force attackers to recreate the physical housing to conceal modifications.
“It’s going to be a lot harder for an adversary to inject additional hardware into the device, because they would have to recreate the entire housing,” Grand said.
Grand also pointed to anti-tamper guidance from electronics engineer Dave Jones, while cautioning that even stronger physical protections should not be treated as a guarantee. In his view, these improvements may raise the difficulty and cost of supply-chain attacks, but they won’t eliminate the risk entirely.
That distinction is important for investors and builders watching the broader hardware security landscape. The goal is likely not absolute invulnerability, but reducing the feasibility of attacks that work only when a device can be quietly modified in the field.
Meanwhile, the reseller and distribution response appears to be moving in parallel with device-security thinking. Earlier coverage from Cointelegraph noted that Ledger asked resellers in parts of Southeast Asia and Hong Kong to halt sales after the unauthorized implant findings.
What to watch next
As hardware wallet incidents evolve from isolated reports to broader questions about distribution controls, users should watch for both operational changes—reseller screening and tightened distribution—and technical updates that address physical compromise, not just firmware integrity. The key uncertainty is whether future incidents will follow the same pattern as Ledger’s described cellular implant behavior, or whether other attack methods will surface as manufacturers and resellers respond.
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