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I'm still flabergasted the HSM allowed this key to be generated. Then again, I've worked with HSMs, there are always many mistakes in the firmware, usually less severe though.
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It seems there was some issue with the ceremony with some wrapping/unwrapping scripts.

They explicitly said they wanted to export the keys from the HSM; the keys were intended for USA/Europe (for sovereignty reasons) but were never actually used.

It seems the HSM itself worked, their ceremony around wrapping/unwrapping didn't.

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Makes more sense.

I'm sure the Utimaco's used (haven't worked with one) also allow all slots to contain the same name or keys with the same name and the device always selecting the first one if you only provide the name and not the slot ID or token identifier. Don't ask how I found out the hard way.

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Yes there was something about key names in the write-up (which I cannot find now)

oh here

https://bugzilla.mozilla.org/show_bug.cgi?id=2083449#c11

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But eMudhra wanted to (was required to) export the keys.

So using an HSM in the first place is a security theater. Or that this HSM isn't really an HSM since it allows for export of the private key.

The trusted enclave in a MacBook is more secure than this HSM.

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There is something called "wrapping/unwrapping" - you encrypt the key, move it to the other HSM, and it unwraps it. So what moves around is encrypted. I don't know enough about HSMs to tell you if it's done using symetric or asymetric crypto, but no the key should not move around in the plaintext.

The write-up from eMudhra mentions something about wrapping/unwrapping ceremony failing.

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Most HSMs used by CAs are pretty trash tbh.
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