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I'm a little confused by the usage of the word "jailbreak" in this article. Neat proof of concept, though!

So what is the best way to set up and configure a Wifi-proxy or MITM for sniffing Android network traffic?

Probably through a usb-tether from a desktop is the easier than trying to mitm over wifi

Charles (Mac) or Fiddler (windows) are the two options I'd use.

That's some questionable security on Razer's part. Seriously, unsigned?

Jailbreaking the Razer Nabu