Ledger’s New Seed Phrase Recovery Service Receives Backlash from Crypto Community

• Ledger has recently released a seed phrase recovery service called Ledger Recover, which offers users additional safeguards in case of misplacement.
• The service requires users to provide a national identity card or passport and to trust their seed phrase with “external custodians.”
• Community members have voiced their disapproval of the service, citing concerns over its security implications.

Ledger’s New Seed Phrase Recovery Service

Ledger has recently released a new seed phrase recovery service called Ledger Recover, offering its users added safety measures should they misplace their seed phrase. This subscription service provides an extra layer of protection for private keys by dividing them into three encrypted fragments that are trusted with three custodians: Ledger, Coinover, and a third entity. Each fragment is stored on hardware security modules (HSMs) and can only be decrypted on a Ledger device. In order to use the service, users must provide a national identity card or passport.

Criticism from the Community

Despite the added security benefits this new service carries, it has come under stinging criticism from its community over its latest seed phrase recovery idea, with members taking to social media to voice their disapproval. Criticisms vary from unease about trusting one’s seed phrase with external entities to more serious security concerns due to previous data breaches experienced by Ledger in 2020 which exposed the phone numbers and physical addresses of over 300,000 customers as well as email addresses of over 1 million users.

Ledger Responds To Criticism

Ledger has responded to this criticism by stating that there are several inaccuracies in what is being said regarding the new update. It also clarified that using this service is optional and that those who wish not to use it may continue managing their own recovery phrases as before without any issues.

The Risks Involved

Though many are concerned about trusting third parties with sensitive information such as national identity cards or passports, some experts suggest that these risks could be mitigated if proper protocols were followed when dealing with external custodians for storage of personal data. Furthermore, since each fragment is useless on its own and can only be decrypted on a Ledger device, there is an additional layer of security provided here as well when compared to other services relying solely on online accounts for backup purposes.


In conclusion, while the risk factors associated with using an external entity for storage cannot be dismissed entirely yet it seems like the controversy surrounding this issue might be slightly exaggerated at times. While some may find comfort in managing personal backups without any outside assistance others may decide it’s worth exploring how exactly external entities may help improve their overall safety measures when dealing with sensitive data such as crypto wallets and passwords – especially when considering all available options out there today!