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In terms of hardware safeguards, is it really an improvement when we have to rely on proprietary hardware safeguards that may have government "special features" silently built in, vs open source software that can be inspected by the public?

The point is to make the hardware itself feasible to verify. There are ways to do this arbitrarily well. Traditional HSMs are a very bad choice for "interesting" users for exactly this reason -- look what Crypto AG did to the Iranian Government and others, and other vs proofed commercial devices.

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