Crypto community reacts to Ledger wallet passphrase service

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Several members of the crypto community, including owners of Ledger wallets, have taken to social media to express their displeasure following the release of Ledger’s latest feature. The newly introduced recovery solution for its hardware crypto wallets, known as Ledger Recover, aims to provide protection in case users misplace their seed phrase.

Ledger Recover is a subscription service that allows users to use an additional layer of protection for their private keys. This service uses a technique in which the user’s seed phrase is split into three encrypted fragments, each sent to different external entities. Once these fragments are combined and decrypted, they can be used to reconstruct the original seed phrase.

The wallet provider shared that Ledger Recover is an optional subscription for users who want to back up their recovery passphrase. “You don’t have to use it, and you can continue to manage your recovery phrase yourself if that’s why you bought a ledger,” the company explained.

Nonetheless, the concept has enraged many in the crypto community, including security specialists.

Mudit Gupta, the Information Security Manager at Polygon Labs, shared, This is a horrible idea, DO NOT enable this feature. Gupta elaborated further in his Twitter thread that the problem here is that encrypted key parts are sent to 3 companies and they can reconstruct your keys.

Binance Founder and CEO Changpeng Zhao chimed in on Guptas’ thread, saying: So the seed can leave the device now? It sounds like a different direction from “your keys never leave the device”.

Bitcoin (BTC) investor and podcaster Chris Dunn shared, First they exposed their customers’ mailing addresses, phone numbers, and email addresses And now they’re putting a backdoor in the starting sentences. It’s time to say goodbye to Ledger, referring to the Ledger data leak that exposed user information in 2020.

Crypto investor DCinvestor, also referenced Ledger’s previous data leak that left users exposed and vulnerable, recalling that several years ago Ledger leaked the names and home addresses of all their customers through a data breach. their servers is your private key.

Bitcoin investor and entrepreneur Alistair Milne shared, Of course, you *could* use Ledger’s new “Recover” service and give them […] your private keys controlling your assets as well as a copy of your ID and other personal information……but then why bother with a hardware wallet in the first place? His post suggested that Ledger’s latest recovery service is undermining any interest in self-custody via a hard wallet.

Related: Ledger Data Leak: A Simple Error Revealed Buyers of 270K Crypto Wallets

In April, Ledger launched the Ledger Nano S Plus, a specialized wallet suitable for non-fungible tokens (NFTs). The Ledger Nano S Plus aims to enhance user security and provide an enhanced experience for Web3 clients who regularly trade NFTs. This development follows Ledger’s recent integration of “clear signature” technology through Ledger Live, further strengthening user security measures.

Established in 2014, Ledger has become a leading global player in the field of cryptocurrency hardware wallets. The company is said to have sold around 4.5 million wallets and introduced six distinct wallet models.

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