Cardano founder Charles Hoskinson shared several views on Twitter regarding the controversy surrounding the Ledger Recover key recovery service.
Recently, a debate has been sparked in the crypto community over Ledger's new key recovery service, Ledger Recover, which offers hardware wallet users an option to regain access to their funds in case their wallet is lost, damaged or stolen.
The company, which is currently the largest hardware wallet manufacturer in the world, unveiled Ledger Recover as an alternative for users who prefer to keep a backup copy of their seed phrase. However, although it is an optional service according to Ledger, its introduction has generated a great deal of controversy.
The crypto community has many doubts and concerns about this new Ledger service, especially, for the data breaches the company has suffered in the past and which have resulted in the massive leak of their clients' information, who were targets of phishing attacks and more.
As such, several crypto industry leaders, including Andreas Antonopoulos, Jameson Lopp, and Mudit Gupta, have weighed in on the impact and risks of Ledger Recover. Most have criticized Ledger for this new service, for putting users' security and privacy at serious risk. On Twitter, Polygon Labs CISO said that the idea of Ledger Recover was “horrendous.”
Cardano founder Charles Hoskinson has joined the Ledger Recover controversy and has shared several of his views on the current controversy on Twitter.
Hoskinson's views on Ledger Recover
First, Hoskinson emphasized the importance of Choosing and using open source software that has been subjected to numerous audits, in order to guarantee transparency to users and facilitate the identification of vulnerabilities.
Hoskinson also stressed security and decentralization, highlighting that Non-updatable firmware plays a crucial role in ensuring a consistent security model, while decentralizing the upgrade process can significantly improve overall security.
At this point, Hoskinson refers to statements made by Ledger Support regarding the possibility of updating the firmware to incorporate the option to encrypt, fragment and distribute wallet keys when users choose to use Ledger Recover.
Following these statements, user @NewWageCrypto then questioned the possibility of incorporating firmware that allows extracting keys from a wallet. Ledger Support responded to the user that, technically speaking, this possibility has always existed, but that Ledger users are confident that it will never be implemented.
The promise of hardware wallets
The founder of the Cardano network also explained the importance of security for cryptocurrency users, especially for those who choose to use a hardware wallet like Ledger, instead of hot wallets.
“People buy hardware wallets to maximize the personal security of their funds,” Hoskinson explained, assuring that users of Ledger and other hardware wallets They do not expect a user experience equivalent to that offered by hot wallets or hot wallets connected to the Internet.
“We chose to use hardware wallets because they ensure that private keys remain in one place, on hardware that is tamper-resistant,” Hoskinson said.
Finally, the founder of Cardano wrote, as a recommendation, “do not break social contracts”, referring to the need for companies to honor commitments that they have acquired with the crypto community.
In this regard, Umed Saidov, Director of Staking at Wave Digital Assets, commented on how Ledger has lost the trust of a large part of the crypto community by introducing its new key recovery service and acknowledging that it can lead to confiscation. “It takes years to build trust and just one bad update to lose it all,” wrote Saidov.
What is Ledger Recover?
Ledger Recover is a new service introduced by Ledger to allow users, if they prefer, to keep a backup of their keys and seed phrases, in order to recover access to their funds in case of loss or damage to their hardware devices.
Ledger’s key recovery service works by creating a backup of the seed phrase generated by the wallet. This backup is then split into three parts, which are encrypted and distributed among three different custodians. Additionally, when using the service, users must provide their personal data by going through a KYC check, which will then serve to confirm their identity when recovering their keys. But this entire process undermines the company’s principles of security and privacy and decentralization in the crypto industry, as 1inch co-founder Anton Bukov stated in a tweet last week.
Continue reading: Anthony Pompliano: “Bitcoin is the world’s largest insurance company”
