When a Ledger Nano S is connected to Electrum, and the HWW contains the corresponding private keys for the attached Electrum wallet, the ledger symbol lights up in green.


How does Electrum confirm the device is holding the correct private key to spend the UTXO's contained in the Electrum wallet?


Does it simply receive the XPub stated by the device, and trust that the device holds the private keys for said XPub, or is there verification (ie: some type of signing) to confirm it?



In short, does Electrum verify that a device is accurately stating the private keys it holds or is verification only done during signing and prior to this the green ledger light on Electrum is an indicator only (trusting that the device holds the corresponding keys because the device says so)?