The recent introduction of Ledger’s secret recovery phrase service, called Ledger Recover, has generated significant backlash from members of the crypto community. The feature, designed to provide an additional layer of protection for users’ private keys, allows the seed phrase to be divided into encrypted fragments and stored with external entities. However, this concept has sparked discontent among security experts and crypto enthusiasts alike.
Ledger emphasized that Ledger Recover is an optional subscription service, and users can continue managing their recovery phrase independently if they prefer. Despite this assurance, the crypto community remains skeptical and critical of the new feature.
Mudit Gupta, the chief information security officer at Polygon Labs, expressed strong opposition to the service, stating that it is a “horrendous idea” due to the involvement of three corporations in reconstructing the keys. Changpeng Zhao, CEO of Binance, also raised concerns about the seed leaving the device, contradicting the previous principle of keeping keys within the device.
Furthermore, some community members referenced Ledger’s past data breach, where customers’ personal information was exposed, as a reason for mistrust. The sentiment is that entrusting private keys to Ledger’s servers would be ill-advised considering the previous security lapse.
Critics, including prominent figures like Chris Dunn and Alistair Milne, argued that Ledger’s recovery service undermines the purpose of using a hardware wallet for self-custody. They questioned the necessity of entrusting private keys and personal information to Ledger when the fundamental appeal of a hardware wallet is to ensure full control and security.
Ledger has been a significant player in the hardware wallet industry since its establishment in 2014, selling millions of wallets and introducing various models. However, the introduction of Ledger Recover has triggered a strong reaction within the crypto community, raising concerns about privacy, security, and the overall integrity of the recovery process.