Ledger Supply Chain Tampering Leads to Millions in Stolen Funds, Including a Scammer’s Cache
Ledger, a prominent hardware wallet manufacturer, has been forced to suspend its reseller network across Southeast Asia this week following a sophisticated supply chain attack that saw thieves steal over $103.4 million from 530 addresses. The perpetrators reportedly tampered with Ledger devices, inserting spyware designed to record seed phrases, before they reached consumers.
In a twist of fate, one of the alleged victims of this scheme was a scammer themselves, according to blockchain analytics firm Chainalysis. The firm reported that this individual lost 60 Bitcoin, valued at approximately $4.8 million, from three newly purchased Ledger devices. The thieves consolidated all the stolen funds into a single wallet.
Adding to the irony, the scammer in question had been operating a “task scam,” where individuals were paid to post fake reviews and sales for legitimate products. Chainalysis noted that this particular scam often involved victims being told to deposit their own money to receive payments, creating a “negative balance” scenario. This suggests a potential “scammer of scammers” situation, a common occurrence in the volatile cryptocurrency landscape.
Despite reports of tampered Ledgers surfacing in Europe, prompting electronics retailer MediaMarkt to halt sales, Ledger maintains that all confirmed thefts to date have originated from Asia. The company has instructed resellers in Indonesia, Singapore, Thailand, the Philippines, Vietnam, Malaysia, and Hong Kong to remove its products from sale. Competitor Trezor has also announced it will be discontinuing relationships with some of its more distant resellers starting January 1, citing an inability to guarantee the same level of oversight as with closer partners. No tampered Trezor devices have been reported.
Amidst this significant hardware wallet security incident, Ledger has unveiled its latest device, the Atom. Priced at $849, the Atom combines a cryptocurrency wallet with Android applications, which are kept separate from sensitive wallet operations. Ledger claims the device incorporates protections designed to thwart the type of implants used in the Asian thefts and can detect tampering even when powered off.
South Korea Blocks Unregistered Crypto Exchanges, Tightens Cybersecurity
South Korean authorities have moved to block domestic access to 27 websites operated by unregistered cryptocurrency exchanges and other virtual asset service providers, including major platforms like KuCoin, MEXC, Phemex, and Bitrue. The Financial Intelligence Unit (FIU) announced that these blocking measures will now extend to websites, mirroring previous actions taken against mobile applications.
The list of blocked entities also includes CoinW, BTCC, BitMart, BingX, and DigiFinex. This move follows an investigation into earlier security incidents involving 16 companies, which revealed significant cybersecurity vulnerabilities.
In response, South Korea will implement stricter cybersecurity requirements for financial institutions. The Financial Services Commission plans to enhance threat monitoring, conduct more frequent security assessments, and strengthen executive accountability after an industry-wide review found cybersecurity deficiencies at 130 out of 555 financial companies.
Separately, Jeonbuk Bank has reportedly begun offering Bitcoin-backed loans to corporate clients, with a third-party custodian managing the cryptocurrency used as collateral.
Thailand Greenlights Crypto ETFs, Cautious Optimism for Inflows
Thailand’s Securities and Exchange Commission has finalized new rules, effective Friday, that will permit cryptocurrency exchange-traded funds (ETFs) to be listed on the Stock Exchange of Thailand. The initial offerings will focus on Bitcoin and Ether ETFs, which must be exclusively listed on the Thai stock exchange. Products tracking foreign crypto ETFs will not be permitted at this stage, and Thai brokers are prohibited from facilitating investments in overseas crypto ETFs for retail investors, with exceptions for institutional and ultra-high-net-worth individuals.
James Butterfill, head of research at digital asset investment firm CoinShares, advised a measured approach to the development, suggesting that initial inflows are likely to be modest, with tens of millions of US dollars being a more realistic expectation than billions.
Australia Consults on Crypto Platform Regulations
Australia’s securities regulator has initiated a public consultation on proposed capital, custody, and trading requirements for cryptocurrency platforms. These proposals are part of the implementation of legislation passed in April that expands oversight of the digital asset industry.
Key proposals include three alternative capital models, restrictions on platforms trading for their own accounts, and quarterly reporting of wallets holding customer assets. The Australian Securities and Investments Commission (ASIC) also proposes allowing offshore custody, while seeking feedback on safeguards in the event of a failure of an overseas parent or related company. Furthermore, ASIC is considering extending the rules for contracts for difference (CFDs) to the crypto market, allowing traders to speculate on price movements without owning the underlying asset.
China Loses Legal Battle Over Seized Bitcoin
Chinese fraud victims seeking to reclaim 61,000 Bitcoin seized by the British government have suffered a setback after London’s High Court ruled that Chinese law, rather than English law, should govern claims to the assets. Justice Mark Turner stated that the relevant damage and contractual relationships occurred in China.
The dispute originates from an investment fraud scheme orchestrated by Zhimin Qian between 2014 and 2017, with British authorities seizing the assets during a money-laundering investigation. The claimants intend to appeal the ruling in British courts.
Philippines Exchange Coins.ph Denies License Revocation Risk
Coins.ph, a major cryptocurrency exchange in the Philippines, has stated that it remains licensed by the country’s central bank, despite reports suggesting a potential license revocation. The alleged risk stems from transactions involving restricted offshore gambling operators.
The central bank had previously imposed restrictions on certain incoming transfers involving DCPay Philippines, which manages Coins.ph’s peso e-wallet services. Coins.ph has vehemently denied any claims of knowingly serving offshore gaming or gambling operators, asserting that user funds are secure and that the company continues to operate as a BSP-licensed institution.
Hong Kong Sees New Solana ETF Launch, Binance Eyes Equities
Binance co-CEO Richard Teng indicated at the Token2049 conference that the exchange may expand its platform to include Hong Kong, Korean, Taiwanese, and Brazilian equities.
In related news, Pando Finance’s Solana ETF has launched on Hong Kong’s HKEX under the ticker 2831.hk. This marks the second such fund, and it features a 0.6% fee, undercutting the 0.99% annual fee of the first fund from ChinaAMC.
Singapore Reports Significant Drop in Crypto Scam Losses
A crackdown by the Singapore Police, in collaboration with local cryptocurrency exchanges, has contributed to a 43% year-over-year decrease in reported losses from crypto scams.
Revolut has also announced plans to open a new Singapore office, invest S$350 million (approximately US$273 million) over the next five years, and expand its local workforce from 170 to 300 employees.
