Opinions from the crypto community
The crypto community has been buzzing with reactions to Ledger wallet’s secret recovery phrase service, which allows users to retrieve their funds in case of a lost or damaged device.
Established in 2014, Ledger has become a prominent global player in the realm of hardware cryptocurrency wallets. The company has reportedly sold an estimated 4.5 million wallets and introduced six distinct wallet models.
The service, which was announced on 16th May 2023 by Charles Guillemet a CTO at ledger in a tweet on their official twitter page, has been met with mixed reviews from the community.
Exciting update, Ledger has a new product, Ledger Recover, that’s launching soon: https://t.co/nT1VHnnSYz
— Ledger (@Ledger) May 16, 2023
🧵Here’s what Ledger Recover is and what it isn’t, explained by @P3b7_ & in the thread below. pic.twitter.com/RW1w07H6pK
The possibility of storing a recovery phrase on Ledger’s servers, rather than having to manually write it down or keep it in your posession is mystifying to some and goes against the whole purpose of having a hardware wallet some say
In a tweet, Crypto investor and CIO at Altana Digital Currency, Alister Milne stated “there is no point in having a hardware wallet if your seedphrase can be stored online.”
Sure, you *could* use Ledger's new 'Recover' service and give them the your private keys controlling your assets as well as a copy of your ID and other personal information...
— Alistair Milne (@alistairmilne) May 16, 2023
... but why then bother with a hardware wallet in the first place? pic.twitter.com/ZI39B01gFV
The co-founder and CEO of Binance, the world’s largest cryptocurrency exchange, Changpeng Zhao, known as CZ, made a joke about this new update by pointing out in a tweet how the phrase coined by Ledger in its early days is no longer applicable. in a reply to a thread by Mudit Gupta a CISO at Ploygon Labs.
So the seed can leave the device now?
— CZ 🔶 Binance (@cz_binance) May 16, 2023
Sounds like a different direction than "your keys never leave the device". 🤷♂️
Some sceptics worry that if Ledger’s servers are breached, sensitive information might be exposed, and hackers could get access to recovery phrases of customers putting users’ funds at risk.
In addition, some members of the community have complained that Ledger does not provide sufficient transparency about its security measures. With some suspicion being placed on potential targets for government surveillance.
There is no doubt that ledger has had a poor track record when it comes to security. In July 2020, the company suffered a security breach due to a hacker who dumped a large amount of data.
The hacker revealed personal information like telephone numbers and addresses of more than 270,000 customers. Chris Dun a crypto investor expressed his concerns on the new update on his twitter page.
First they exposed mailing address, phone numbers, and email addresses of their customers…
— Chris Dunn (@ChrisDunnTV) May 16, 2023
And now they’ve put a back door into seed phrases.
It’s time to say goodbye to @Ledger ✌️ https://t.co/FsZw1jUt6h
On the other hand, many members of the crypto community are excited about the potential convenience of the service. They argue that storing recovery phrases online eliminates the risk of losing them or having them stolen in a physical location
Overall, the introduction of the secret recovery phrase service has sparked a lively debate within the crypto community. While some are sceptical about the potential risks, others are excited about the convenience and peace of mind that the service could offer.
As with any new development in the crypto world, it is important for users to do their research and weigh the pros and cons before deciding whether to use the service.