A severe security vulnerability is raising alarms in the cryptocurrency community, particularly affecting Bitcoin wallets using Chinese ESP32 chips.
This flaw poses a significant risk to traders. It could potentially threaten millions of dollars in digital assets worldwide.
Bitcoin Wallet, ESP32 Chip Risk
The ESP32 chip is manufactured by Espressif Systems, a leading Chinese technology company. Due to its cost-effectiveness and adaptability in embedded systems, this chip has been widely adopted in various hardware wallets. It was designed to protect Bitcoin (BTC) and other cryptocurrencies.
The hardware of Blockstream Jade Plus wallet also integrated the new ESP32-S3 chipset for seamless operation.
Despite its popularity, cybersecurity experts have discovered a critical vulnerability identified as CVE-2025-27840. This vulnerability allows hackers to bypass security protocols and extract private keys. Another critical crypto-MCP flaw enables hackers to expose seed phrases or redirect blockchain transactions without user detection.
According to a deep analysis by Crypto Deep Tech, this vulnerability allows attackers to forge ECDSA signatures. Hackers can then facilitate unauthorized transactions that users cannot detect.
"Attackers can use various methods to access Bitcoin wallet private key data through ESP32." – Crypto Deep Tech warning
In actual tests, researchers successfully exploited this vulnerability to access a Bitcoin wallet holding 10 BTC. This highlights the potential for substantial financial loss. The chip's Bluetooth and Wi-Fi connections exacerbate the risk, allowing hackers to deploy malicious updates and remotely extract sensitive data. This issue is particularly critical for Electrum-based wallets.
The repercussions of this vulnerability extend beyond individual investors, raising broader concerns about comprehensive network security. Experts warn that this vulnerability could enable state-sponsored espionage activities and organized theft operations targeting devices relying on ESP32.
The discovery of this flaw has sparked a debate about the reliability of Chinese-made components in critical financial infrastructure.
"I will not use an ESP32-based hardware wallet for single signatures." – X user nvk warning
So far, specific wallet models affected have not been widely identified. However, pressure is mounting for manufacturers to provide transparency and disclose impacted products to mitigate risks and protect users.
