Trezor wallets sold by one reseller had hidden hardware that steals recovery phrases

Three Trezor Safe 5 wallets that left a Southeast Asian reseller between Aug. 20 and Sept. 23 carried an extra circuit board that nobody at the factory put there. Each board sat between the main board and the screen, and each one was built to copy the recovery words the owner wrote down when setting up the device. Trezor confirmed the finding on Nov. 12, after weeks of suspicion.

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The reseller is CryptoBilis, which Trezor dropped from its authorized list on Oct. 9. No owner has reported lost funds so far, and a firmware release from Nov. 11 now blocks the implants Trezor found, though it cannot erase a phrase captured earlier.

An extra board between the main board and the display

The chain began with a customer in Indonesia who bought a Safe 5 through the Tokopedia marketplace in August and opened it. Trezor’s team said in its Oct. 30 notice that it had not yet seen the device and was treating the report as credible, thanks in part to help from the Security Alliance’s emergency service, SEAL 911.

By Nov. 12 the picture was firmer. According to BleepingComputer, Trezor examined the original unit in its lab and used photos supplied by owners to identify two more. The implant leaves the wallet’s own firmware and its Secure Element untouched, which is why the device can pass ordinary software checks while still leaking.

The timeline shows how slowly the story assembled. Ledger began investigating fund losses among CryptoBilis customers on Oct. 9, and Trezor pulled the reseller the same day as a precaution, before it had any sign its own devices were affected. Trezor announced on Oct. 13 that it was cutting its reseller network by about 80 percent. The buyer’s report reached the company on Oct. 28, and the first public warning followed on Oct. 30, as BleepingComputer reported that day.

Cellular module, retry loop and the recovery words

Instead of attacking the chip that holds the keys, the board watches what the screen displays. It captures the recovery words shown during backup creation or wallet restoration, and it can pick up a passphrase if one appears on screen. The data is encrypted and sent over a mobile network to an attacker-controlled server, and if no signal is available the board stores it and keeps retrying until the upload succeeds.

The Hacker News, whose report on the confirmation ran on Nov. 13, notes that implants have turned up only in Safe 5 units from this reseller, not in stock from other resellers or in other Trezor models. Trezor says its implants work the same way as those found in Ledger devices sold through CryptoBilis, adapted to a different display.

Reading the screen is a clever way around the design of a hardware wallet. The device exists so that the secret never touches an internet-connected computer, and its Secure Element guards the keys. An implant that sits downstream of that chip and simply watches the pixels never has to break any of it. The recovery words have to appear on the display at some point, because that is how an owner writes them down, and the cellular antenna gives the board its own route out without using the owner’s computer or network.

Firmware 2.13.1 and what it cannot undo

Trezor released firmware 2.13.1 on Nov. 11 for the Safe 7, Safe 5, Safe 3 and Model T. The company’s statement says the update adds a protection that stops the implants it has found from capturing anything on a device running it, which leaves the current implants useless on updated wallets.

That protection is forward-looking only. Any recovery phrase that was displayed and transmitted before the update stays in an attacker’s hands, so Trezor’s advice to anyone who bought a device from CryptoBilis since March is to create a new wallet with a new recovery phrase and move the funds. Restoring the old phrase on a different device does not help, and an unused unit should not be set up at all.

Trezor also says weighing or opening a device is not a reliable test. It is offering replacements or vouchers to buyers from the reseller since March, including those whose devices are not confirmed as compromised, and it warns that scammers may use the news to impersonate its support staff and ask for recovery phrases, which the company says it never requests.

The reseller cull and the unanswered supply-chain question

Forty-eight CryptoBilis customers had contacted Trezor by the time of the confirmation, and the company has said it checked devices either in the lab or by photo. It also cut its global reseller network by about 80 percent, announced in October, saying the removed partners were trustworthy but did not meet stricter sourcing, storage and access controls. Dropped resellers may sell existing stock until Jan. 1, 2027.

Ledger’s own statement on its implant case came first, and a Singapore police advisory on tampered hardware wallets followed on Oct. 28. Neither Trezor nor Ledger has said who installed the boards or at what point in the supply chain it happened, and Trezor has promised an update if it finds an implant outside CryptoBilis stock or the Safe 5.

This article was produced with the assistance of AI and reviewed by Morning Overview editors prior to publication.