[robotrout]

Regarding the "private key on the USB drive", I think the USB drive contains their software. Your private key is typed in at a password prompt.

Regarding the "contempt of court" threat, they need to implement hidden volumes, like TrueCrypt does, and that will be addressed.

[_cbsz]

The password prompt is for a passphrase to unlock the private key. It's standard to encrypt the private key using the passphrase to provide some protection against the loss of the key.