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Crypto News

Hedera and Algorand Forge Alliance for Wallet Recovery System

Author

Jay Solano

Tags

Tags Editor's Choice / Slider Posts

Reading time

2 mins
Last update

Author

Jay Solano

Tags

Editor's Choice / Slider Posts

Reading time

2 mins
Last update

Author

Jay Solano

Tags

Editor's Choice, Slider Posts

Reading time

2 mins
Last update

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Launch of the DeRec Alliance

Hedera and Algorand, two significant players in the blockchain domain, have joined forces to create the DeRec Alliance. This initiative, announced at the Crypto Finance Conference in St. Moritz, is a collaborative effort to develop a decentralized recovery system for digital assets. The alliance was introduced by Leemon Baird, co-founder of Hedera, and John Woods, chief technology officer of the Algorand Foundation.

Objective of the DeRec Alliance

The primary goal of the DeRec Alliance is to enhance the security and recovery processes for digital assets, bridging the gap between the complex world of decentralized finance (DeFi) and the more user-friendly experiences of Web2 platforms. Baird emphasized the need for the industry to develop easy-to-use, standardized recovery methods for key management across all blockchains. The alliance includes various participants, including banks, credit unions, and wallet software projects.

Introduction of DeRec Protocol

The DeRec (Decentralized Recovery) open-source protocol was unveiled alongside the alliance. This protocol is based on secret sharing among selected helpers, like friends or businesses, to enable users to recover their secrets when necessary. The protocol ensures confidentiality; each helper’s share is cryptographically secure and provides no insight into the original secret. It allows for automatic resharing and confirmation processes, maintaining privacy even among the helpers.

Focus on User Experience and Security

Both Baird and Woods highlighted the importance of a seamless user experience in DeFi, stressing the need to reduce risks associated with self-sovereignty. The DeRec protocol is designed to simplify and secure the management of digital assets, addressing a key challenge in the DeFi sector. This initiative comes when the DeFi space increasingly focuses on bolstering security measures, as evidenced by recent recommendations from regulatory bodies like the United States Commodity Futures Trading Commission.