Ledger Seed Store In Email Breach
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A ledger hardware wallet user learned the hard way about never storing their seed phrase in a digital format. 3 years after setting up their wallet and storing a backup of the seed phrase in their email account, they found all wallets drained of $13k worth of cryptocurrency that they'd been saving up.
This is a global/international case not involving a specific country.[1][2][3][4][5][6][7]
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."
"I purchased the Nano S over two years ago BECAUSE of security." "3 years ago, when I purchased the Ledger, I wrote down the recovery phrase, and it's been in the burn safe since. BUT, I also, can't believe I'm saying this, but I did enter it into my phone, and sent it to my own email address, where it has been ever since, I guess thinking if I ever lost the paper with the 24 word phrase, or it was stolen, I would have it there, so I could recover my assets."
"I mine Bitcoin as well, so I would be accessing through Ledger Live almost every week to sell and pay for electricity. Everything was normal for 3 years." "I've only had 2FA for maybe 1 year on email, and also weird thing is, looking through my security settings there, 2FA had been disabled, SOMEHOW. That must be how they hacked email." "I enabled 2FA a couple years ago, and have not checked it since."
"I recently logged into my account in Ledger Live expecting to see a great increase with the price of Bitcoin moving up. Instead of seeing what I expected to be about $13,000.00 worth of Bitcoin, Ethereum, Bitcoin Cash, and Ethereum Classic, I see $0.00 balance on everything! I am absolutely blown away, saddened, and disappointed." "[O]ne day I opened it, 2 days ago, bam, every single bit was gone."
"[I]t seems I have lost literally everything, and there is no phone number to contact this company, only through emails, which they have not responded to. I can clearly see all of the funds from every crypto I was holding were sent out to different addresess which have now all been confirmed on the blockchain."
"[A]fter reading through all these comments, and everybody saying I must have entered my passphrase on my computer or phone at some point, you guys are right. I forgot, that Well, I guess that means somebody else can recover my assets too. :(" "Somebody hacked my email, got the 24 word recovery phrase, which I had stored there, my dumb fault, lesson learned, and recovered my ledger account on a different Ledger nano S, and at that point had access to move everything. :("
2FA on the email "is now enabled again, password changed too of course." I "will definitely be setting up my ledger with a new seed." "I got 2FA enabled on email now, and also NO sensitive info is stored in my email account. Passwords, and 2FA changed and reset on every account I have." "Next ledger I set up will have the phrase on paper, and NEVER see digital format."
"At least now I know, never, EVER to type the recovery seed in any digital format. Still cannot believe they managed to get it off my email, I have 2 factor authentication on my email account as well and they somehow got around that."
"This IS MY FAULT, and I take full blame for it. I guess I just never thought, without somebody having access to my e-mail that anyone would ever possibly be able to get access to it. It's just so weird, that it's been 3 years, and the assets were just now stolen. I've had close to that amount in there for a couple years now."
"I thank you for your help and research, i'm the idiot here. $13,000 lesson learned. NEVER INPUT YOUR RECOVERY PHRASE INTO DIGITAL FORMAT. Still wish there was something that could be done, but I know once it's gone, it's gone in crypto. Such a shame now that it looks like Bitcoin is beginning it's bull run."
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.
| Date | Event | Description |
|---|---|---|
| August 1st, 2020 1:21:10 PM MDT | 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 $13,000 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?
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.
References
- ↑ ALL of my stored cryptocurrency has been STOLEN from my Ledger Nano S! : ledgerwallet (Mar 19, 2022)
- ↑ Ledger Raises $380 Million to Expand DeFi Solutions - Crypto Briefing (Mar 19, 2022)
- ↑ Physical addresses of 270K Ledger owners leaked on hacker forum (Jan 31, 2022)
- ↑ Scammers Are Using Fake Devices to Steal Cryptocurrency Wallets | PCMag (Mar 6, 2022)
- ↑ Address: 3Jw6owESya9Y5KuDXijkmGbS74sbPQYcFH | Blockchain Explorer (Mar 23, 2022)
- ↑ Transaction: bddba7a7075ca09527de8680bfb467469eace554e72c21137d2ff76cb3e98cf2 | Blockchain Explorer (Mar 23, 2022)
- ↑ https://etherscan.io/tx/0x2ae04b4601af2bb3a0725560055bc97a48da396b2fd87f2683bfed0188d8ac9c (Mar 23, 2022)