Ledger Malicious Chrome Extension HackedZec Theft

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Ledger

Ledger, based in France, is on of the most popular manufacturers of Ledger hardware wallets. A malicious Ledger browser extension for Chrome was found at the number 1 spot, which requests the user's seed phrase and sends it to the extension creator, who then uses it to steal funds from users. At least one user lost $16k from this extension. The affected user reported the crime only locally, and no funds have been recovered.

This is a global/international case not involving a specific country.

About Ledger

"Based in France, Ledger is the largest cryptocurrency hardware wallet company." "Ledger is a hardware cryptocurrency wallet that is used to store, manage, and sell cryptocurrency. The funds held in these wallets are secured using a 24-word recovery phrase and an optional secret passphrase that only the owner knows."

"Ledger offers two products, the Nano S and Nano X, that can store the digital keys used to secure crypto wallets. The devices can be used with a variety of cryptocurrencies, are compatible with numerous apps, and are supposed to offer a safe way to manage crypto without compromising too much on convenience. Ledger says on its website that it has sold 1.5 million products to customers in 165 countries to date."

"Since the introduction of the Chrome Web Store in 2011, it has become the largest catalog of browser extensions with over 200,000 available to all of our users. This has helped millions of users to customize their browsing experience on Chrome in ways we could have never imagined, from niche utilities to companies building businesses around the platform’s capabilities."

"The official Ledger Support Twitter handle confirmed the detection of the extension malware on Jan. 2, using the header “PHISHING ALERT.”"

"PHISHING ALERT. A Chrome extension malware has been detected called "Ledger Secure". This is NOT a legitimate Ledger application."

"According to the user, this extension is a scam that imitates a Ledger product to steal the crypto assets of users from their Ledger wallets. He stated that the malware used sends users’ seed phrases to its creator allowing them to access assets held on their Ledger wallets. He also revealed that the scam had already affected one user."

"Twitter user and software architect WizardofAus (@BTCSchellingPt) has warned cryptocurrency holders against a Chrome extension for Ledger crypto wallets that allegedly contains malware." "[I]t's the #1 result searching for @Ledger extensions on the chrome store."

"Malware Chrome extension alert. If you have "Ledger Secure" installed - REMOVE IT. The @ChromeExtension "Ledger Secure" contains malware that passes your seed phrase back to the extension's author. This is *not* a @Ledger product. Successfully used against @hackedzec."

"According to WizardofAus, the malware has already claimed at least one victim, allegedly stealing 600 ZEC – roughly US$16,000 – from Twitter user @hackedzec."

"“@hackedzec”’s Twitter handle was notably created in Jan. 2020; both the handle’s novelty and the chosen name suggest that he created the account specifically to spread awareness following his experience of the malware."

"In @hackedzec's case, 600ZEC were taken from his Ledger Nano by the extension author. That's around 2.3BTC /USD$16k - bigtime pain." "In WizardofAus’ account, 600 in Zcash (ZEC) — worth roughly $16,000 by press time — was stolen from @hackedzec’s holdings in his Ledger Nano by the Chrome extension’s creator."

"600 $zec was stolen from me this year." "It was a huge loss - should have reached out to crypto twitter but oh well. There are ppl like me that actually got hacked."

"Former Trezor executive and contributor to the “Little Bitcoin Book” Alena Vranova retweeted WizardofAus’ tweet with the comment: “another proof that the word ‘secure’ does not imply security.”"

"Referring to Casa founder Jeremy Welch’s warnings last year against browser extension malware at the Bitcoin (BTC) event Baltic HoneyBadger in Riga, WizardofAus outlined the risks posed by these products — and what users can do to protect themselves." "@jeremyrwelch from @CasaHODL presented on precisely this risk at Baltic HoneyBadger 2019 in Riga - malign browser extensions."

"Firstly, be very careful what extensions you install. If you're using the same computer for your crypto as you use generally, be extra diligent. Better to have a separate minimal machine - or use a Virtual Machine that is the only place you do crypto activity. For using software with your hardware wallets, use the wallet vendor's software. When you get that software, check it comes from the vendor's website, that the link is secure, and ideally you can validate the software checksum. Please learn from others' expensive lessons."

"Stolen $zec coins are being moved. 300 of the 600 moved to exchanges. Not sure if anybody knows what exchanges these are."

"Google has acknowledged a general problem with malicious extensions and has announced new rules for the Chrome Web Store. It said:"

"We want to ensure that the path of a user discovering an extension from the Chrome Web Store is clear and informative and not muddled with copycats, misleading functionalities or fake reviews and ratings."

"The rules forbid developers from publishing multiple extensions that do the same thing, and prohibits misleading metadata, including anonymous user testimonials in app descriptions. Developers can’t upload extensions that exist solely to launch another app or extension, and they shouldn’t send spam notifications, the company added."

"It said that developers must comply with the policy after 27 August 2020. After that point, apps violating the rules “may be taken down and disabled”."

HackedZec "[t]racked it down thru tx addresses - ended up at bittrex." "I actually tracked my funds down to Bittrex and they know the name of the user, but won’t release it unless law enforcement requests it. Unfortunately, local law detectives don’t know what to do - and won’t pursue the case." "Local police had no idea what to do & refused to pursue it."

This is a global/international case not involving a specific country.

The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.

Include:

• Known history of when and how the service was started.
• What problems does the company or service claim to solve?
• What marketing materials were used by the firm or business?
• Audits performed, and excerpts that may have been included.
• Business registration documents shown (fake or legitimate).
• How were people recruited to participate?
• Public warnings and announcements prior to the event.

Don't Include:

• Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
• Anything that wasn't reasonably knowable at the time of the event.

There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.

The Reality

This sections is included if a case involved deception or information that was unknown at the time. Examples include:

• When the service was actually started (if different than the "official story").
• Who actually ran a service and their own personal history.
• How the service was structured behind the scenes. (For example, there was no "trading bot".)
• Details of what audits reported and how vulnerabilities were missed during auditing.

What Happened

The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.

Key Event Timeline - Ledger Malicious Chrome Extension HackedZec Theft

Date	Event	Description
January 1st, 2020 12:38:00 AM MST	Main Event	Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.

Technical Details

This section includes specific detailed technical analysis of any security breaches which happened. What specific software vulnerabilities contributed to the problem and how were they exploited?

Total Amount Lost

The total amount lost has been estimated at $16,000 USD.

How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

Immediate Reactions

How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?

Ultimate Outcome

What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

Total Amount Recovered

There do not appear to have been any funds recovered in this case.

What funds were recovered? What funds were reimbursed for those affected users?

Ongoing Developments

What parts of this case are still remaining to be concluded?

General Prevention Policies

Never provide your seed phrase to anyone except the actual physical hardware wallet. No official Ledger applications nor services will ever ask you for it.

Individual Prevention Policies

No specific policies for individual prevention have yet been identified in this case.

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

Policies for platforms to take to prevent this situation have not yet been selected in this case.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

No specific regulatory policies have yet been identified in this case.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.