Coinbase wallets now allow the users to back up their private keys on Google Drive or iCloud. As per the official statement released on Feb. 12, this has been done to safeguard against lost keys.
The official announcement adds that the new feature will help the user to avoid losing funds, in case their keys are misplaced. The announcement elaborated:
“The private keys generated and stored on your mobile device are the only way to access your funds on the blockchain. Owners of ‘user-controlled wallets’ like Coinbase Wallet sometimes lose their devices or fail to backup their 12 word recovery phrase in a safe place, thus losing their funds forever.”
Coinbase Wallet users will be able to store an encrypted copy of the recovery phrase on their cloud accounts. The platform added that neither them nor the cloud services could access the user’s fund, as the recovery phrase key uploaded will be unlocked by a password that is only known to the user.
The back-up is intentionally encrypted with AES-256-GCM encryption due to which it will only be accessible through the Wallet mobile app. The platform adds that along with Google Drive and iCloud, they will soon expand support to other clouds in the future. Notably, the new feature will be an opt-in service that does not replace or supersede the original recovery option.
The need for such measures
This action comes on the foot of the QuadrigaCX mishap. The Canadian cryptocurrency exchange, filed for creditor protection earlier this month, following the death of its founder Gerald Cotten. Reportedly, Cotten was the sole executive responsible for the exchange’s keys and cold wallets.
His sudden death has put the exchange into a fix as it can not access over $145 million in digital assets it purportedly needs to remain solvent. However, an
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