Topic: Ledger Recovery - Send your (encrypted) recovery phrase to 3rd parties entities - page 17. (Read 5425 times)

Nothing happens by chance, everything is well thought out, and apart from profit, the point is to put as many users of this HW as possible in a position where they can be controlled. Of course, not everyone will accept the new service, some because of the price and KYC, others because they understand how absurd and dangerous it is, but let it not surprise anyone if Ledger turns that service into something mandatory in the future, because their "mothers" and maybe even 200 millions of users are super satisfied and they will ask the company to protect those of us who don't understand it.

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Yes, it's easy to see what attitude he has towards anyone who dares to criticize what he does, but he's one of those people who always thinks that everything they do is perfect and completely right. I lost my trust in that company a long time ago, but after everything that has happened now, I will be extra motivated to warn all current and future users to think seriously about whether they will trust someone who makes such risky and senseless decisions, and has such a hypocritical attitude attitude towards those who made it possible for him to be what he is today.


I wouldn't even say that there is a plan in the sense that someone devised it, but that the plan is actually to let people do what they know best, which is to destroy themselves. Everything that is happening is just an indication of how wrong we were when we trusted companies like Ledger or Trezor, or that most Bitcoin trading is conducted through CEX. For the first time in history, we got a decentralized currency, and in fact we centralized it to such an extent that it is mostly stored in a centralized way.

Still, it's not too late to change, everyone can use DEX and store their coins in airgapped storage, and if the majority did that, people like Pascal, CZ or Brian Armstrong would become completely irrelevant.

Good point!

To clarify, I'm under no delusion that open source means 100% security -- see Heartbleed affecting OpenSSL for example. I'm just saying that the level of trust required and security provided by open sourcing your code is on a wholly different level.

Dapps and DEXs are actually a great example of the limits of using the many eyes principles of open source for additional security and trustlessness: (1) The developer communities are much smaller because they are splintered across a variety of projects, (2) the incentives for using an exploit yourself rather than doing a responsible disclosure are much higher (i.e. while you could monetize a 0-day you find on a hardware wallet or cryptographic library by selling them, exploiting a smart contract nets a much higher pay day without an intermediary) and (3) those projects unfortunately often come with both a leadership and community that tend to downplay and sometimes silence valid concerns as FUD (IIRC SOL was the posterboy for that).

Yes, I'm referring to that video. It made me moody and angry how Pascal (he doesn't deserve this surname) looks at Bitcoin users. You could see an ironical and humiliating attitude towards bitcoin users in his speech. I bet he even laughs and thinks how stupid people are when they buy/order his hardware wallet.

At some point I think that there is a bigger overall plan and FTX, Ledger and other companies are part of this plan, yes, I know it sounds like a conspiracy theory but everything can happen. Look, top exchanges fail/scam/go-bankrupt, now hardware wallets are probably going to get hacked/leaked. Isn't this a reason to ban bitcoin usage/trading/mining/etc? Probably this is a real plan or probably they think that people are dumb and want to take an advantage of that.

No, o_e_l_e_o said that Ledger could offer people a new device called Ledger Nano R(ecover) and offer Recover option only on that device but that's not gonna happen because on paper, Ledger says that their Recover subscription is optional for everyone and if they don't want to use it, their seeds won't be backed up, so, I told him that's the reason why Ledger simply doesn't have to produce another hardware wallet with that option.

By the way, we don't actually know whether Ledger wallet already came with turned on self-destructive button or not but one thing is sure, they went against the wish of people who value privacy, so this product is not for us. Ledger is definitely the modern Trojan Horse in bitcoin world.

I agree with you to some extent. However, I want to mention all those Dapps, decentralized liquidity providers, DEXs for ETH tokens and the likes that have been hacked or exit scammed numerous times in the past. Their open-source nature didn't prevent it. Nobody noticed the vulnerabilities until the money was gone. "Security experts" provided them with their seals of guarantee which proved to be useless after hackers found ways to breech the platforms. Just because there is a way to inspect a code doesn't mean those doing it put that much effort into it.

Besides profiting even more, they are doing this as a sign they are willing to cooperate with certain governments, maybe even in collusion with them. We never understood why Wasabi would partner with a blockchain analysis company and why Trezor would do the same. We also won't understand this in its full context. Stricter regulations are coming, and governments are ensuring they have partners everywhere.

Look at where the companies that will be storing the shards are located. The USA and the UK + the last shard is held by Ledger. Don't you think they couldn't have found partner companies elsewhere? Of course, they could have. The way they did it now, the right document from the right 3-letter agency in the US gets US authorities one shard, with Ledger gladly supplying the second one. 

You are forgetting one thing. The code for Ledger Recover will become available on your device if you upgrade the firmware. For now, that's true only for the Nano X. You decide if you want to switch the feature on or off, but Ledger brings it to you no matter what. Imagine a self destruct button in your car, where, if you press it, the car explodes. I am not going to press it, but I am not comfortable having it there at all. Ledger has already decided to add that button.

I laughed when I first read that, because it's such a stupid attempt to convince current clients and future customers that this service is something they should use.


Are you referring to this YT video? I watched it yesterday and I have to admit that I was even more disappointed with how Ledger looked at the whole situation, and that he actually called everyone who raised their voice people who spread FUD for no reason. The part in which Pascal talks about the Ledger leak scandal is especially incredible, because he claims that almost no one knew that it happened, and that the event had no impact on the company, suggesting that the dust around seed sharing will soon settle. That part is available at 56:20.


Some old information that I know without googling says that there were about 2.4 billion FB users, although of course not all of them are unique users. But regardless of all those users, I don't think that Ledger will one day even have 100 million users, I'm somehow more convinced that this company will fail much sooner, and that it will probably be destroyed by this same service that they are trying to sell now. The three companies that will keep the seeds will sooner or later be part of some data leak, hundreds or thousands will be hacked that way and then there will be no going back.


I don't doubt that, profit is the only thing they are interested in, especially if you look at how these people live luxuriously and how they flaunt their wealth (a gold ring on every finger), and the hunger for even more money makes them do such things.

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Good catch, and just another minus in the whole story. However, reading the comments of some people under the video I linked, it is incredible how many people believe in the nonsense that people from Ledger are talking about. Einstein was definitely right.

It is because of this that civil aviation systems, at airports and in radars, use technology that is more than 50 years old. Of course they are making some updates, but always based on the technology designed for over 50 years.

They thus manage to ensure greater security, as hackers have more difficulty in invading these systems, which are "outdated" compared to what is used today.

This is why I only trust old equipment but sadly in near future I'll won't be able to use them. I personally believe that when computers, mobiles and softwares were at an early stage of development, real aim and priority was to improve the technology and make things better but once there is a lit of potential to earn billions, then this takes over every positive thinking and real aim becomes to improve technology in order to gain more control and influence.

I simply can't trust modern hardware, I'm afraid highest percentage of them are backdoored. I prefer to create and hold my bitcoin wallet in a 2008s personal computer than in modern Intel Core i5-13400 with RTX 4090 GPU.

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Btw I have mentioned many times that the level of security depends on the level of asset value but the hardware wallet and KYC accident really makes me think twice for now.

And miss out on millions of existing Ledger users who can all be convinced to pay $9.99 per month to compromise their keys? Doing the right thing doesn't earn you money.

This is why I never fully trusted hardware wallets. I can't possibly know for sure what happens inside the black box.

If Ledger Recover was a mandatory service, then that would make sense but since its optional, there is no logical reason to produce another series of hardware wallets. You can either subscribe it and pay $9 monthly or just ignore it and use Ledger in a traditional way.
P.S. Don't remind me that an optional service is bullshit and there is a chance that they may have already created a backup of our seed, I know that. But not everyone thinks so.

It is an interesting talking point because it is exactly the same talking point that Square/Block have been using to promote their hardware wallet which has no seed phrases and shares custody of your back up with third parties.

For example, here is their business lead Lindsey Grossman using the 100 million figure, and then talking about her "friends and family": https://youtu.be/WbjzZQwDozw?t=355

Or, the incredibly simple solution which would have avoided literally all of this drama - create a new product called Ledger Nano R, which is the only product in their range which provides this Recovery nonsense. People who want third parties to store their seed phrase can buy the R, and everyone else with a shred of sense can stay away from it.

^

And what are your thoughts on  Christopher Allen statement expressed to CoinDesk that "Secure element chips can’t perform the kind of cryptography needed to completely encrypt user keys on-device". If it is true then all hardware wallets are not safe because that "kind of cryptography"  mentioned by Allen  they have to perform outside SE.

You forgot to mention that you'll also get KYC during the whole process and you might even be unable to access the funds considering how wonky the KYC recognition procedures currently are . Now that's a "incredible" deal .

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Besides CTO roadmap announcement, Ledger CEO & Chairman Pascal Gauthier also shared a letter yesterday regarding Ledger Recovery[1] which is basically saying what every top chairman on the company is spreading at the moment - "we'll open source as most as we can regarding Ledger OS". This[2] particular tweet is also interesting:
Is it just me, or so far they have failed in every aspect mentioned by him?

• Transparency - They are always dodging the real questions and only give half answers;
• Censorship Resistance - Considering the fact that, as soon as you have your shards in external entities you could have your shards, a government can subpoena them, how "censorhip resistance" is this?
• Security - I think we all agree to disagree on this one .

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[1]https://nitter.it/_pgauthier/status/1661012614753943559
[2]https://nitter.it/_pgauthier/status/1661012625575272453

But it's only $9.99 per month, plus lifetime access to your keys, and you are safu up to $50k.  
Sounds like a ''great'' deal, right

Let me remind everyone that Chinese hardware wallet Safepal is currently doing exactly the same thing as ledger, they are sending keys to google and iCloud 

Haha, I laughed a lot You made my day

In podcast, the CEO of Ledger said that they have 6 million customers. That's a tiny number if they have calculated that up to 100 million users are in queue in near future and are exactly looking for this service.
I want to ask you, how many people use Facebook? Google search? Keep in mind that these companies don't give a shit to users personal information and it has been proven for many times and still their profit and userbase increases every day. Millions of facebook users post what and where they eat, where they work, what movie they watch, send sensitive information in messenger, etc.
Don't you think that these people aren't going to somehow step in a crypto world? And don't you think that they can be that 100 million users and will willingly use Ledger Recover service?
Let's say that Ledger has two options: A. Their profit will increase slightly if they keep their current crypto enthusiast customers happy and B. Their profit will dramatically increase if they lose some of their customers but attract a lot of new customers who will pay them $9 every month.
Ledger is a business, a corporative company, right? And it's clear to see that this company wasn't founded by a crypto enthusiast but by a person who is a businessman and wants money. They go with option B.

Einstein once said: Two things are infinite: the universe and human stupidity.

In recent posts, the "geniuses" from Ledger refer to their mothers and some future 100 million clients, and to me it looks like senseless and cheap propaganda, and by no means some kind of story that is based on the fact that Ledger is overwhelmed by requests from thousands of users who literally ask the company to allow them to share their backup with some unknown companies.

All those supposed users who are looking for such a risky feature actually have no idea what kind of nonsense they are looking for, and Ledger as a company turns out to be an even bigger fool if they enable this feature. In my opinion, the intention (although I think it is not true that a large number of users asked for it) of enabling such a service only shows that Ledger does not care that they try to present risk as a benefit, as long as their additional profit is behind it.

I also wouldn't call the millions of current users "tiny userbase", nor would I agree that some new users will rush to buy their devices in the future, although I may be living in the illusion that the average Bitcoin user will wise up with time and realize that Ledger has become bad product.

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Just to add that it might be more correct to say that the vast majority of those who don't want it actually belong to that small percentage of people who understand the basic difference between a bank account and actually owning Bitcoin in the sense of "not your keys, not your coins". If a person does not understand the essence of Bitcoin, then it does not matter to him how the backup is stored, and if Ledger remains the leader in the sale of hardware wallets after all, it will only confirm that even the best ideas in the wrong hands do not make much sense.

Yes and no. Ledger is deliberately setting up a false equivalence of trust.

Yes, there's always a certain degree of trust required: If you can verify the code, you still need to trust the compiler. If you can verify the compiler, you still need to trust your CPU. If you can verify the CPU, you still need to trust the laws of physics.

But.

Contrary to what Ledger is trying to sell, trusting a single company to "do the right thing" is not even remotely the same as having thousands of developers and hackers -- independent and contracted alike -- making sure that there's nothing fishy going on. It simply isn't.

I don't think people have accepted KYC, people have no other choice. That is the reason why there is a demand on decentralized exchanges and why people use so many non-kyc casinos/instant-exchanges/mixers.

In the first place, that was never a case with crypto exchanges at first. KYC become implemented over time, the same happens with hardware wallets over time.

He said that a lot of people write him and tell him that they can't carry the responsibility of keeping 24 word seed phrase safely and ask them for recovery options. Basically, what he says is 100% true for majority of users. I have even stated earlier that Ledger wouldn't do such a risky move without research and confidence. At the moment a lot of people are angry about their decision but it's a business, Ledger aims to satisfy upcoming millions of users instead of a current tiny userbase.

We know where its going, they want to know how you earn, how you spend, they want to control everything, that is the aim.

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He said in a podcast that a lot of people tell them that they can't handle the responsibility of keeping 24 words seed phrase safely and they want a recovery option. To be honest, I believe in what he said. It's you, me and one or two other guys who cares, majority doesn't care. I genuinely believe that they have done research and backed this decision of theirs.

It won't if it works the same way transaction broadcasting works. You need physical confirmation to broadcast a transaction, and Ledger has said you will also have to physically allow the sharing of the shards. Whether or not that is true is another topic of discussion. 

Putting aside the open-source vs closed-source war, I think the trust lies in the fact that the developers and security experts did their job properly to not mess up the code or introduce vulnerabilities that someone can exploit. That's what most people have to trust because most of us don't know how safe a code is whether we can view it publicly or not.

Trezor's open-source code means very little to me because I can't go through it and I don't understand what it does. I still have to trust Trezor and everyone that has verified the code that it's bulletproof and can't be abused. That's the trust part.   

This x1000. I do not believe that the Ledger team do not understand the difference between KYC on a centralized exchange where you already have zero privacy and zero security and are well aware the centralized exchange has complete control of your coins and is monitoring everything you do, versus KYC on a hardware wallet where the vast majority of people are going to want complete security and a reasonable amount of privacy. The vast majority of people do not want their hardware wallet addresses KYCed or their wallets linked to their real identity and that information shared with blockchain analysis companies, governments, and whoever else pays for the data.

I'm sure Ledger know this, but are being deliberately misleading in the defense of their new vulnerability feature.

There is some truth in the fact that the majority have accepted KYC as a standard procedure, but still mostly when it comes to CEX, but this was never the case with hardware wallets, even though Ledger leaked data of hundreds of their clients, and the company is swept it under the carpet and tried to convince clients that there was actually no danger in it.

This is just a continuation of everything that happened, because if we read between the lines, then the message that Ledger sends is something along the lines of "you are not ready to be your own bank anyway, your backup is safer in our hands", which is very similar to what said comrade CZ, when he called practically 99% of his users "stupid" and asserted that they are not capable of being their own bank.

If you look at the bigger picture and all the regulations, especially in the US and the EU, then it is much clearer in which direction all this is going. Let no one be surprised if in the future any HW will be impossible to use without detailed KYC, and the so-called "recovery" will also be mandatory, which will mean that most of the bad-informed will keep their BTC in a custodial service.