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The key is not stored in the clear, and the device password is entered before a keylogger can run. https://www.eff.org/deeplinks/2014/10/even-golden-key-can-be...

It's called "key escrow" and there are tons of ways to do it.

Look up US patents under 380/286 classification.

I know what key escrow is. Nitrogen didn't claim that Apple does that, and for good reason -- there is absolutely zero evidence that they do.