Hardware wallet maker Trezor reports 900% weekly sales growth CryptoSlate with reference to the company’s press release.
The surge came after competitor Ledger introduced a seed recovery option, which caused controversy in the community.
“We believe that hardware wallets are cold storage that assumes 100% self-sufficiency. At no stage should they make the seed available to anyone other than the user,” said Trezor CEO Matei Jak.
The company emphasized that their products are completely open source. This allows independent technical experts to check all processes and make sure that private keys cannot be accessed remotely.
The Recover subscription service introduced by Ledger for the Nano X model provides the ability to restore the seed phrase from a backup. The latter is divided into three encrypted fragments that are stored by third-party custodians. The user gets access to them through confirmation of personal identification.
Part of the community was concerned about device security issues related to the option. Theoretically, the fragment holders could collude and gain access to the wallet. A number of users have suggested that the Ledger firmware originally included a backdoor to extract private keys and this is not related to the Recover subscription.
Former CEO Eric Larchevec declaredthat the only problem with the new option is the failed PR support of the launch. At the same time, he admitted that the authorities could receive encrypted fragments of the seed phrase from the custodians through the court.
His opinion was confirmed by the current head of the Ledger, Pascal Gauthier. He noted that to ensure greater transparency, the firm will accelerate the disclosure of the source code of products, including the Recover service.
In the fall of 2022, information appeared on the network that Ledger was collecting advanced customer data. The company denied such assumptions, saying that they have access only to depersonalized public information.
In 2020, the wallet maker admitted to data breaches of approximately one million users. An unknown party received information about email and postal addresses, names, phone numbers and purchased Ledger products.
Amid discussions about the Ledger Recover service, some of the company’s customers have announced they are ditching its devices in favor of competitors like the Trezor.
i have broken my ledger wallet and bought trezor. ledger is not listening to their customers and they are arrogant and stubborn. funds are not safe in ledger anymore with this backdoor.
— Iskender Murat Yucel (@IskenderMuratY3) May 26, 2023
However, not everything is so good with the Ledger competitor. In May, Unciphered posted a video on YouTube demonstrating the successful hacking of the flagship Trezor T. They used Read Protection Downgrade (RDP) attackextracted the seed phrase from the chip and restored it.
The manufacturer noted that the hack required physical access to the wallet, deep technical knowledge and modern equipment. To address the vulnerability, the company worked with its subsidiary Tropic Square to develop a secure chip.
Trustee CTO Ksenia Zhitomirskaya commented on the doubts of Ledger users regarding the compliance of cold storage devices for Cryplogger. According to her, self-storage with sufficient precautions is safer than closed-source wallets with an opaque update policy.
“Methods of storage [сид-фразы] – in a fire safe on paper or other materials (non-flammable and non-corrosive). You can use offline devices that are as different as possible from cold wallets, which, by their very appearance, provoke scammers,” Zhitomirskaya added.
Sales of major hardware wallet providers Ledger and Trezor surged significantly in November 2022 amid FTX troubles. The collapse of one of the largest exchanges drew the attention of users to the possibility of self-storage of crypto assets.
The importance of non-catodial ways to ensure the safety of their funds was pointed out by such influential people as the head of Binance Changpeng Zhao and ex-CEO of MicroStrategy Michael Saylor.
Recall that in February, Trezor announced the acceleration of the production of hardware wallets to reduce the delivery cycle from two years to several months.
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