Ledger to halt blind signing on dApps, encourages clear signing for security
The policy shift can be seen as Ledger's attempt to address the impact and severity of last week's exploit.
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A week after an exploit on its Connect Kit library led to losses of over $600k, Ledger has announced its decision today to disable blind signing for all Ethereum dApps.
We are 100% focused on following up to last week’s security incident, making sure incidents like this are prevented in the future, and that the ecosystem remains safe.
We are aware of approximately $600k in assets impacted, stolen from users blind signing on EVM DApps.
— Ledger (@Ledger) December 20, 2023
Blind signing is when a user signs a transaction without being fully aware of its contents. The details in this type of verification are not “human-readable” because they are displayed as raw smart contract signing data.
According to Ledger, it will end blind signing for Ethereum dApps currently supported by its hardware wallets by June 2024. The hardware wallet provider also committed to reimbursing victims of the hack. Ledger claims it is working with its community and ecosystem partners to establish Clear Signing as a security standard.
“Front-end attacks have happened many times before and will continue to plague our ecosystem. The only foolproof countermeasure for this type of attack is to always verify what you consent to on your device,” Ledger stated.
While blind signing is intended to enhance privacy and security by providing complete details, it can pose a significant risk if a user is unaware of the exact specifications of what they are signing. Blind signing may allow malicious actors to trick users into unknowingly approving unauthorized or malicious transactions, putting their assets at risk.
On the other hand, clear signing allows users to view the full details of a transaction in a human-readable format before verifying and providing authorization. This method provides a degree of transparency and helps users ensure that they are approving legitimate transactions.
As explained in our coverage of the incident, the attack began with a sophisticated phishing attempt on a former Ledger employee who still had access due to delays in manually revoking their access. The hacker used an exploit identified as an “Angel Drainer attack” to route user assets. When users of the affected dApps signed transactions they could not fully view or understand, the wallet drainer payload automated transfers to the hacker’s wallet, effectively siphoning off funds.
The policy and priority shift can be seen as Ledger’s attempt to address the impact and severity of last week’s exploit.
In 2020, a data breach that originated from Ledger’s e-commerce database was discovered, exposing personal information from over 270,000 Ledger customers. Ledger later denied allegations that this leak was connected to its wallets.