Hardware wallet maker Ledger has unveiled a tool that allows you to back up your seed to regain access to your Nano X device.
Exciting update, Ledger has a new product, Ledger Recover, that’s launching soon: https://t.co/nT1VHnnSYz
🧵Here’s what Ledger Recover is and what it isn’t, explained by @P3b7_ & in the thread below. pic.twitter.com/RW1w07H6pK
— ledger (@ledger) May 16, 2023
The decision to use the Ledger Recover subscription service is made by the user independently. The tool splits the Secret Recovery Phrase into three fragments, which store three different sides in encrypted form.
If necessary, the owner of the wallet gets access to the backup copy of the phrase to restore the private key through confirmation of personal data.
“Non-custodial storage remains and will always be our guiding principle. The idea is that it’s your choice – you can manage your assets yourself or have a backup with Ledger Recover, ”the company emphasized.
The function will be launched “soon”. According to Wired, the service will cost $9.99 per month, Ledger, Coincover and EscrowTech will act as custodians. Users in the US, UK, EU, and Canada will initially have access.
The community reacted ambiguously to the announcement.
“This is a terrible idea, DO NOT enable this feature,” urged Polygon Labs CIO Mudit Gupta.
The expert was concerned about the risk of storing encrypted fragments by three companies, which, in theory, can recover the keys themselves.
Ledger just released a new update for Nano X that allows social recovery of your seed phrase.
It encrypts your seed in 3 shards and sends it to different entities that can then reconstruct the seed for you post ID verification.
It’s a horrendous idea, DON’T enable this feature. pic.twitter.com/2E1GSuYN5r
— Mudit Gupta (@Mudit_Gupta) May 16, 2023
“Guys, what are you doing? This is rapidly moving in the wrong direction. I would not recommend anyone to switch to such firmware, ”said a crypto investor under the nickname DCinvestor.
hi @Ledgerit’s concerning your software & hardware wallets will soon be capable of sending a private key across the internet for opt-in sharded backup
wtf are you guys doing? this is going in the wrong direction fast
i would recommend no one upgrade to such firmware
— DCinvestor (@iamDCinvestor) May 16, 2023
According to him, the function is contrary to the core value of the company’s product – self-custody assets.
1inch co-founder Anton Bukov spoke in a similar vein. In his opinion, Ledger violates the main security message for a hardware wallet that “it should not have API to expand the seed phrase”.
Omg, @Ledger is breaking the main hardware wallet security assumption that “it should have no API to expose seed phrase (private key)” pic.twitter.com/H31NHShhyZ
— Anton Bukov 🦇🔊 ⚖️ (@k06a) May 16, 2023
Recall that in March, the manufacturer announced the expansion of the Series C funding round against the backdrop of rising sales after the collapse of FTX. Presumably, the Ledger valuation will be €1.3 billion.
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