Crypto wallet manufacturer Ledger has unveiled its “Recover” feature, resulting in a new wave of skepticism from certain sections of the crypto community. The service, which acts as a backup for users’ recovery seed phrase, has been incorporated into Ledger’s widely-used Nano X wallet, as announced by CEO Pascal Gauthier on X (formerly known as Twitter).
Recovery seed phrases comprise a series of 12 or 24 random words. They are critical for users to regain access to their crypto wallets. Consequently, losing or forgetting these words implies the potential permanent loss of the digital assets stored in the wallet. As a solution, crypto wallet creators provide various methods to backup these seed phrases.
However, Ledger’s approach, unveiled in May, sparked debate. The “Recover” method involves encrypting users’ private keys, which are then duplicated and partitioned into three segments. Each segment is stored with a distinct entity: Ledger itself, the crypto security company Coincover, and a third-party backup service provider.
Upon the announcement of this elective, fee-based service, Gauthier faced renewed criticism on X. Detractors argued that Ledger was essentially charging users to potentially increase the vulnerability of their private key.
Nonetheless, Gauthier defends the service, emphasizing its purpose of addressing concerns from users wary of the inherent risks of forgetting their recovery seed phrase. In his words, “The fear of losing the Secret Recovery Phrase deters many from adopting crypto and especially from opting for self-custody.”