Mark Karpeles, former CEO of Mt Gox, is developing a low-cost detector to check whether Ledger hardware crypto wallets contain malicious components. The move follows reports of tampered Ledger devices carrying parts that could steal 24-word recovery phrases, raising supply-chain security concerns. Karpeles says the device would use low-power wireless signals and resonance tests, and he may publish PCB designs and specifications. No working unit or independent verification has been released.

Hardware wallet maker Ledger classified a case involving illicit components inserted into its devices as an organised crime attack on the distribution chain and announced countermeasures. Attackers bought genuine devices, opened them and implanted components designed to steal recovery phrases, then distributed them through a Southeast Asian dealer network. Ledger said its chips, operating system and servers were not compromised. It said it is working with law enforcement to trace stolen funds and dismantle infrastructure.