Scammer gets scammed in Ledger spy-chip exploit, loses almost $5 million in bitcoin

A scammer who used modified Ledger hardware wallets containing a spy chip to steal victims’ recovery phrases was themselves tricked into revealing access to their funds. The attacker reportedly lost nearly $5 million in bitcoin, which was moved by the person who exposed the scheme. The incident highlights that compromised hardware and recovery phrases remain serious security risks—and that even sophisticated scammers can fall victim to social engineering.