Ledger updated its wallets and gave its customers a new level of stress
The new key recovery feature has caused an uproar in the crypto community.
Ledger, a French company that makes hardware wallets for cryptocurrencies, has faced backlash from customers and crypto enthusiasts. The reason for this was her statement on Twitter that she always had the technical ability to install firmware on her devices that allows access to users’ private keys. This was said in an attempt to appease those concerned about the new Ledger Recovery feature.
Ledger Recovery is a service the company launched this week. It is designed to recover passwords of users who have lost access to their wallets. The service stores the encrypted part of the secret phrase (seed phrase) of the user and issues it upon request with identity confirmation.
Many Ledger customers and members of the crypto community have criticized the innovation.
“It is completely absurd to offer to store a backup copy of the seed phrase on the Internet and show your passport or ID, especially after the recent data leaks,” write Reddit users. In their opinion, the update is contrary to the principles of privacy and security declared by Ledger.
In response, Ledger tweeted that it could always write firmware that would help extract users’ keys. The tweet was later deleted.
“We have always had and have the ability to create a firmware that will give us access to your keys. You have always trusted Ledger not to do this, whether you knew it or not,” the company said in a statement.
“We kept the revolver pointed at your head all this time, but don’t worry, you didn’t die. So there is no problem if we continue to keep this revolver, ”one of the commentators noted sarcastically.
Ledger later said that its words were “taken out of context”: according to it, there are layers of protection and control in the firmware of wallets that ensure that no one (not even company personnel) can publish malicious firmware. To this, one of the Ledger customers replied that he was not buying “access levels”, but simply a hardware wallet.
“First time in my memory that a company destroys its own reputation on live stream,” wrote one user in the Ledger Recovery discussion thread.
Some Ledger Nano users believe that the launch of the update is one of the logical steps to increase regulation of the crypto industry. Users on Reddit fear that sooner or later governments will require similar measures from all crypto service providers.