- Ledger’s new update includes a subscription feature for an additional layer of protection on its hardware wallets.
- Ledger Recover breaks down and sends the users’ encrypted seed phrase into three external entities.
- Prominent names in the crypto community have spoken against this latest feature, calling it a bad idea rather than a good one.
Ledger Recover may be suitable for users prone to lose their seed phrase or unsure about the security level of their hardware wallets. The latest update is not mandatory, as the crypto hardware wallet provider affirmed that the subscription feature is optional.
On May 16, crypto hardware wallet provider—Ledger—shared the exciting news with its 500k followers, announcing its latest development and the launch of Ledger Recover. This feature would allow Ledger users to subscribe for additional security on their hardware in case they misplace or forget their private keys.
The new feature is a subscription service that would break down the user’s seed phrase into three and send each to a unique external entity. These fragments are encrypted and, once received by the user, combined and decrypted, could be used to recreate the initial seed phrase that was misplaced or forgotten.
Ledger mentioned that the new feature was not mandatory for every user as it was optional, and they could continue with their recovery phrase if that were their purpose for purchasing Ledger.
The crypto wallet provider posted a thread on Twitter explaining how the Ledger Recover would work. However, the crypto community has been vocal about disapproving of the new feature.
“You can choose to manage all your assets yourself, or you can have a backup with Ledger Recover. It’s up to you, and that won’t change,” Ledger stated on Twitter.
In response to the announcement of the new subscription service, the chief information security officer at Polygon Labs, Mudit Gupta, shared his opinion, stating that it was a “horrendous idea.” The CISO asked that users not enable this new feature, citing that the seed phrase could only be reconstructed after ID verification.
Although Gupta praised the company’s innovation, his main concern was about the insecurity of ID verification as “anything secured by ID verification is inherently insecure” and easy to fake.
Changpeng Zhao, the CEO and Founder of the famous crypto exchange—Binance—also contributed his opinion by asking Mudit Gupta if the seed phrase could leave the device now.
A Twitter user queried the company’s recent actions, reminding them of the goodwill the crypto community extended to them after the leak of users’ data in 2020.
Alistair Milne—a BTC investor and entrepreneur—also pointed out that Ledger had contradicted itself by creating a self-custody hardware wallet in the first place if users could use Ledger Recover service, albeit surrendering their ID and private keys to Ledger along the way.
Conclusion
The majority of the crypto community did not accept Ledger’s new feature, as the company may have expected, due to the skepticism about the insecurity of ID verification and the need for a self-custody wallet if this feature were to exist.
