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How does a bug in iMessage lead to my iPhone being completely taken over by Pegasus? I thought apps were sandboxed on iOS.

Or can they only monitor SMS/iMessages with this entry point?

I imagine they use one exploit to get code execution in iMessage, then another exploit to escape sandbox and execute code in kernel.

Yeah. Here’s a 2016 write up when Pegasus (presumably a different deployment) was leaked and reversed: https://citizenlab.ca/2016/08/million-dollar-dissident-iphon...