A team of researchers demonstrated that cryptocurrency wallets Trezor and Ledger are vulnerable to several type of attacks.

During the 35c3 conference held in Leipzig, Germany, the researchers
Dmitry NedospasovThomas Roth, ad Josh Datko demonstrated that cryptocurrency wallets Trezor and Ledger are vulnerable to several type of attacks.

The group of researchers presented called “wattet.fail” firmware, side-channel, microcontroller and supply-chain attacks that impact most popular hardware-based cryptocurrency wallets, including Trezor One, Ledger Nano S, and Ledger Blue.

“The sad reality is there is just not a lot of in cryptocurrency [development]. And that is painful to hear,” said Nedospasov during his speech.

Vendors claimed that the attacks devised by the researchers were impractical.

Hacking the Supply Chain

The researchers demonstrated that it was simple to carry out a supply chain by altering the cryptocurrency wallets before it was sold to the end user. The demonstrated how to tamper with the packaging of a cryptocurrency wallet, They removed the anti-tampering holographic seal using a hair drier.

The operation was very simple for the Trezor One, Ledger Nano S, and Ledger Blue wallets.

cryptocurrency wallets  - cryptocurrency wallets hack - Experts show that is easy to hack Hardware-based Cryptocurrency WalletsSecurity Affairs

Once removed the stickers the attackers can replace the microcontroller with their own chip with a customized bootloader. Attackers can also install a hardware implant, the experts implanted an RF transmitter that used to trigger a transaction in the proximity of the cryptocurrency wallets.

Hacking the Bootloader

Experts discovered a flaw in the Ledger Nano S that is based on the STM32 microcontroller. The could be exploited by an attacker to flash the chip with custom firmware, the experts flashed the device with a version of the game Snake.

The hack was possible because developers left a programming port open and enabled on the Ledger Nano S circuit board. In this way the attackers could modify the microcontroller and compromise cryptocurrency transactions.

Experts pointed out that the wallet has built-in mitigations to prevent this type of attack (i.e. Blacklisting memory regions), but they found a way to bypass them and flash the microchip with their own firmware.

Side-channel Attacks

The researcher Thomas Roth discovered that inside the Ledger Blue there is a long conductor that transfer the signal from the screen to the hardware. It works as an antenna and when the device is connected to a USB cable the signal is amplified.

Roth created radio equipment that used to capture the radio waves and analyze the signals associated with entered PIN digits patterns. In this was it was able to decode them.

Roth’s obtained an accuracy that was high over 90%, he only failed one prediction.

In the attack scenario devised by the expert, the attacker needs to be in close proximity to the device.

Trezor One Chip-level flaw

Experts exploited a vulnerability in the Trezor One that was found in 2017 and patched by the vendor. The issue is a fault injection via a microcontroller used in the wallet, the experts targeted a different microcontroller (STM32F2) in the attacker using a new technique. The experts discovered that a persistent threat actor could steal the wallet’s private key and PIN from the device’s Random Access Memory (RAM), in this was it is possible to take over the device.

Pierluigi Paganini

(SecurityAffairs – Cryptocurrency wallets, hacking)

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