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Earlier this week, Peter Schiff said on Twitter that he lost access to his Bitcoins. He claimed that he did not forget his password, but that his wallet was allegedly corrupted. Just about 40 minutes ago, he tweeted again saying that the wallet was not actually corrupted, and the problem was that he confused the password for the pin, he never knew his password, and he did not have a copy of the seed phrase. Anyway, he lost his Bitcoins.

In another case, Quadriga CX case, where access to the company's digital wallets was lost on the death of its CEO, customers lost more than $ 190 million Canadian Dollars ($ 145 million US).

So What is the solution or the method that we can implement to avoid such as scenarios?

Should we be working on wallets to change the security of private keys?
For Ethereum (ETH) co-founder Vitalik Buterin, these situations highlight an important problem: the loss of private keys (and therefore tokens) is a challenge for those who use cryptocurrencies.

Keeping your own cryptocurrencies could be quite complex for the majority of crypto users. This is especially true for those who are not tech savvy users.

Offline portfolios like the paper or hardware wallet are often highlighted as good alternatives for securing your funds. However, they can sometimes be subject to damage due to the environment or theft or to technical knowledge obstacles.

This is why some people think it would be better for users to keep their tokens in crypto exchanges like Binance, BitBay or Coinbase. This allows them to manage the private keys of their customers who no longer have to worry about keeping them.

This solution refers to the problems observed in the Quadriga CX case and to the fact that the crypto-funds ultimately belong to the one who holds the private keys. If these keys are lost or stolen, if no one else knows them then access to cryptocurrencies is completely lost.

For the co-founder of Ethereum, a new method should be developed: "social recovery"

While the method advocated by the CEO of Binance goes against the very principle of decentralizing cryptocurrencies and being his "own bank", there could be an alternative to recover funds in case of forgotten password or seed phrase.

Social recovery could allow certain trusted people to restore access to certain accounts. Thus, if a user of cryptos loses access to their wallet, they could call on their "guardians" (guarantors or guards) so that they can reassign control of the wallet to them.

For some, the social recovery solution is too similar to the use of centralized entities, although in this case they are relatives. Wouldn't the real question be to make users learn how to keep their private keys and passwords safe rather than finding new solutions to human faults? What do you think?

Note:

I have also published this post on publish0x.
https://www.publish0x.com/cryptoplanet/social-recovery-right-method-not-losing-access-your-wallet-a-xvlnpy

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