My worries with ledger

[T3PR00T]

I have a ledger nano s but I don't feel secure anymore with it after their recent update about subscription for wallet recovery. The only use of the leger is for Bitcoin and I use it with electrum.

I understand their new update does not effect Ledger Nano S but I still feel unsafe, I feel paranoid. Everyday I wake up and check my phone where I have a watch only installed and before the wallet loads I feel I will see an outbound transaction is just loading but it does not and my coins are there. I feel better.

What will be your suggestions?

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[Yamane_Keto]

Your use of the hardware wallet depends on trust. If you lose this trust, it is better to buy another hardware wallet. You can consider any open source alternatives or DIY hardware wallet, and if you wait, you will get better recommendations, since I prefer cold storage using Electrum.

Here is a good list for more than 30 HW https://wallets.thebitcoinhole.com

What will be your suggestions?

According to what I read, you are safe if you do not update the firmware, but after several months you will reach a point where you have to update the firmware, and then you can fear, until that thing happens, start thinking about a suitable alternative instead of worrying.

[satscraper]

I have a ledger nano s but I don't feel secure anymore with it after their recent update about subscription for wallet recovery. The only use of the leger is for Bitcoin and I use it with electrum.

I understand their new update does not effect Ledger Nano S but I still feel unsafe, I feel paranoid. Everyday I wake up and check my phone where I have a watch only installed and before the wallet loads I feel I will see an outbound transaction is just loading but it does not and my coins are there. I feel better.

What will be your suggestions?

First, don't panic.

Second, do research on available  open source, air-gapped HW and evaluate your own prospect of acquiring one of them to  move your stash there.

Third, at the time when your fund is still relying on Ledger Nano S create multisig  wallet, using  say two of two quorum. This means that  two of your keys will be required  to sign transaction. (Any of them alone will not capable to do that) One  of that key may belong to open sorce software wallet (say Sparrow or Electrum or any  of your choice)  the other one to Ledger nano s.The probability to break multisig wallet is equal to   P=  ∏_i=1...n(p_i)  where p_i is the such probability for each individual item from the quorum  set of n items, so if one of p_i=0 then P=0. That said, the large the quorum the better but I think 2 of 2 will be enough in your case.  

Further, move you stash from Ledger Nano S to created multisig wallet.

And then, after the purchasing of open source air-gapped HW  create multisig wallet using your new HW  (instead of  Ledger Nano S )and move your stash from old multisig to new one.

[FatFork]

I feel paranoid.

Paranoia can cloud your judgment. It's good to be cautious, though.

What will be your suggestions?

There is no direct threat to your Ledger Nano S at this time. Nevertheless, if you feel uneasy or don't feel safe with your current storage solution, it's always a good idea to explore other options.

According to what I read, you are safe if you do not update the firmware, but after several months you will reach a point where you have to update the firmware, and then you can fear, until that thing happens, start thinking about a suitable alternative instead of worrying.

If he keeps using the Ledger Nano with Electrum software, he won't need to upgrade the firmware unless he chooses to do so. Firmware updates are exclusively carried out via Ledger Live.

[Lucius]

If he keeps using the Ledger Nano with Electrum software, he won't need to upgrade the firmware unless he chooses to do so. Firmware updates are exclusively carried out via Ledger Live.

Except in the case that for some reason it is necessary to update the Bitcoin app on Ledger, and the condition for this is the latest firmware. What I want to say is that there are ways with which Ledger could perhaps go in the direction of somehow forcing users to the new firmware.

Besides, after all, who can claim that even the current firmware is not capable of performing some things that we thought were not possible at all. It all boils down to the fact that you believe that the other side has no malicious intentions, and by all accounts, their intentions are not very logical, to say the least.

[maxirosson]

My recommendation if you don't trust 100% in Ledger but you want to continue using it because you can't buy another hardware wallet would be:
- Avoid using the Ledger companion app. Use any other third-party software like Electrum, Nunchuk or Sparrow.
- Create a new private key, so you guarantee it never touched the Ledger companion app.
- Create a multi-sig so you reduce your trust in Ledger. You could create a 2 of 3, with 1 ledger and two different software wallets
- Use a passphrase for the 3 private keys

[FatFork]

If he keeps using the Ledger Nano with Electrum software, he won't need to upgrade the firmware unless he chooses to do so. Firmware updates are exclusively carried out via Ledger Live.

Except in the case that for some reason it is necessary to update the Bitcoin app on Ledger, and the condition for this is the latest firmware. What I want to say is that there are ways with which Ledger could perhaps go in the direction of somehow forcing users to the new firmware.

Besides, after all, who can claim that even the current firmware is not capable of performing some things that we thought were not possible at all. It all boils down to the fact that you believe that the other side has no malicious intentions, and by all accounts, their intentions are not very logical, to say the least.

Just to be clear, I wouldn't recommend buying a Ledger device to anyone, especially after the major data leak from their ecommerce database last year and this latest fiasco with the Ledger recover service. However, if he's comfortable with his current hardware device and doesn't plan on getting a new one, there doesn't seem to be any immediate danger (at least as far as we know) that would require him to stop from continuing to use it.

[dkbit98]

What will be your suggestions?

Suggestion about what exactly?
It's silly to check your wallet all the time and be paranoid about this, instead of just moving your coins and getting a new hardware wallet device.
There are many alternative options for open source hardware wallets and if you are only using bitcoin you can also use some of your old offline laptop with electrum wallet.
if you want to have extra security for larger amount of coins than you can create multisig setup, but this will add some additional complexity with your transactions.

[Yamane_Keto]

If he keeps using the Ledger Nano with Electrum software, he won't need to upgrade the firmware unless he chooses to do so. Firmware updates are exclusively carried out via Ledger Live.

Sometimes there are vulnerability here that must be updated, and if they are not obligatory, the user will panic as soon as he hears such vulnerability, and it is not wise not to update the firmware, especially with the popularity of Bitcoin, and it has become the target of hackers and even traditional thieves.

last one: ledger vulnerability: Invalid addresses for certain miniscript policies

Again losing trust is the last thing you need to think about if you are a paranoid so moving to a better wallet would be better, losing part of the money is more important than wasting your health on something not worth it.

[Lucius]

Just to be clear, I wouldn't recommend buying a Ledger device to anyone, especially after the major data leak from their ecommerce database last year and this latest fiasco with the Ledger recover service. However, if he's comfortable with his current hardware device and doesn't plan on getting a new one, there doesn't seem to be any immediate danger (at least as far as we know) that would require him to stop from continuing to use it.

I completely agree, the leaking of all that data along with what they have done now is more than enough warning that this company should not be trusted. Accordingly, I don't think anyone should feel comfortable (safe) using this HW to store large values, because when it comes to Ledger, the only question is what will be the next big scandal. Of course, I don't think that anyone should be in a panic and make hasty decisions, but everyone should start looking for other solutions, whether it's a new HW or using an old PC/laptop as an airgapped device.

[The Sceptical Chymist]

Third, at the time when your fund is still relying on Ledger Nano S create multisig  wallet, using  say two of two quorum. <snip>

Cool, thanks for dropping some knowledge here--and I mean that sincerely.  Not being the most technical-minded person, I'm always impressed by the expertise of the community.

OP, my advice to you would be that if your Ledger is creating a lasting paranoia you'd best ditch that piece of shit wallet as fast as you can throw it into a meat grinder.  I've heard various things about the safety of the Nano S, but at this point I'm not sure what to believe (nor do I care since I'm not using one).  What is clear is that Ledger done told some lies, got caught, got egg in their face that still won't wash off, and justifiably lost a lot of trust that they worked hard to earn.  I've got some suspicions about what they're up to, but I've got no data to back those suspicions up so I won't even go there. 

But you ought to look into one of the HW wallets with open-source code, because that turned out to be the issue with Ledger and the backdoor they rammed up the buttholes of their customers.  At least with something like a BitBox, you can check the code if you're savvy enough.  Good luck.

[Synchronice]

Just to be clear, I wouldn't recommend buying a Ledger device to anyone, especially after the major data leak from their ecommerce database last year and this latest fiasco with the Ledger recover service. However, if he's comfortable with his current hardware device and doesn't plan on getting a new one, there doesn't seem to be any immediate danger (at least as far as we know) that would require him to stop from continuing to use it.

You can't be comfortable with Ledger anymore because they totally lied about everything related to their hardware wallet, especially about Secure Element because as it seems, it's possible to get seeds from SE via hardware changes and the most dangerous part here is that Ledger is closed source, so, you actually don't know if they have ever taken your seeds without your permission at past. I would immediately move coins from Ledger Hardware into another wallet.

I completely agree, the leaking of all that data along with what they have done now is more than enough warning that this company should not be trusted. Accordingly, I don't think anyone should feel comfortable (safe) using this HW to store large values, because when it comes to Ledger, the only question is what will be the next big scandal. Of course, I don't think that anyone should be in a panic and make hasty decisions, but everyone should start looking for other solutions, whether it's a new HW or using an old PC/laptop as an airgapped device.

The next big scandal will be this: Breaking news! Ledger Recover data leak! Millions of users lost their coins.

[Lucius]

The next big scandal will be this: Breaking news! Ledger Recover data leak! Millions of users lost their coins.

Assuming that millions will use this option, which in my opinion is somewhat unrealistic to expect, although Pascal and comrades obviously expect at least 100 million users to appear from somewhere who will be "intelligent" enough not only to buy their HW, but also to share their seed + KYC with companies they have never heard of.

It is amazing that after all the time BTC has existed, some people for quite evident financial reasons are starting to promote custodial services implying that the average man is incapable of being his own bank. If nothing else, if (when) the next scandal happens, at least we will be able to say that we warned people not to use such options, and that the HW itself of this manufacturer is not something they should trust.

[Synchronice]

The next big scandal will be this: Breaking news! Ledger Recover data leak! Millions of users lost their coins.

Assuming that millions will use this option, which in my opinion is somewhat unrealistic to expect, although Pascal and comrades obviously expect at least 100 million users to appear from somewhere who will be "intelligent" enough not only to buy their HW, but also to share their seed + KYC with companies they have never heard of.

It is amazing that after all the time BTC has existed, some people for quite evident financial reasons are starting to promote custodial services implying that the average man is incapable of being his own bank. If nothing else, if (when) the next scandal happens, at least we will be able to say that we warned people not to use such options, and that the HW itself of this manufacturer is not something they should trust.

Pascal indirectly said that average Joe is so stupid that he is incapable to take care of his crypto wallet and will lose his seed phrases. So, since average Joe is such a stupid, he came up with an idea to offer them Recover service. I don't wanna sound offensive but absolutely every person who uses or will use Ledger Recover service, is and will be a very dumb person who somehow got some money.

To be honest, I'm really interested in how this Ledger Recover service goes, if Ledger sees good success by running this service, then my perception about humanity will change and if Ledger goes bankrupt, I'll remain positive and hopeful. If Ledger doesn't go bankrupt but will still remain top in this business, then I'll be more sure that average Joe is stupid and they'll believe what you want them to believe.

[Lucius]

@Synchronice, If people didn't react appropriately when hundreds of thousands of personal information leaked from their company, I don't think most people care if their seed is put at risk at some point. Unfortunately, in the thinking of one of their average clients, this famous recovery is perhaps even something positive, especially for those who believe that Bitcoin should be insured in the way that their fiat deposits are insured in banks.

For those who understand the difference between fiat and Bitcoin, of course, this does not make sense, but for those who are only there for profit and do not care too much about their privacy and security, it all comes down to how skillfully something is presented to them.

[Zoomic]

I understand their new update does not effect Ledger Nano S but I still feel unsafe, I feel paranoid. Everyday I wake up and check my phone where I have a watch only installed and before the wallet loads I feel I will see an outbound transaction is just loading but it does not and my coins are there. I feel better.

What will be your suggestions?

It will be fine I don't own bitcoin than to live in such a situation because of an announce by Ledger and the FUD it created. If you don't feel compromised before the Ledger recovery service implementation, why will you feel so unsafe.
It could look as if your own the highest bitcoin and the attack will begin from you.
 I hope you have recommendation of community members and be healthy first before your coins.

[Pmalek]

It will be fine I don't own bitcoin than to live in such a situation because of an announce by Ledger and the FUD it created. If you don't feel compromised before the Ledger recovery service implementation, why will you feel so unsafe.

I personally don't feel unsafe and still use my Nano S together with a Trezor but for different purposes. I understand why the announcement of Ledger's seed sharing scheme left such a sour taste in everyone's mouth. At least they were "kind enough" to tell us what they are planning. The reactions would have been five times worse if they just implemented this in the background without telling anyone.

If there is a way to send keys from a secure element chip over the internet (when we were told it can't be done), how can we possibly trust everything else we supposedly know? And even if there is trust, how can we know that the implementation is bulletproof and won't result in a serious breech in the future? Even if it's the safest thing on the world, why would I want to have that on my hardware wallet? It's an endless loop of questions people have started asking because they can't believe what is happening.

[DireWolfM14]

The only use of the leger is for Bitcoin and I use it with electrum.

As long as you only use it with (verified) Electrum, you should be good to go for many years.  Electrum is usually agnostic to firmware versions when it communicates with hardware wallets.  I've used both of my Trezor models with outdated firmware and Electrum hasn't had any issues transacting with them.  In fact, that's what I plan to do going forward.  I'll likely never update the firmware on them again, unless my Monero node forces me to update my Model T.  I'm done with Trezor Suite now that they've imbedded a mole into it.

Ledger's Nano shouldn't be any different.  I do suggest that you start looking for an alternative now while you have time, however.  If something happens in the future that breaks the ability to connect your Ledger to a wallet without updating the firmware, you'll want to have an alternative at the ready.

I do recommend both the Foundation Passport and the ColdCard.  Both products are produced by companies who seem to feel strongly about keeping bitcoin private, secure, and self-custodial.

[The Sceptical Chymist]

@Synchronice, If people didn't react appropriately when hundreds of thousands of personal information leaked from their company, I don't think most people care if their seed is put at risk at some point.

I don't know about that; having a database of names, e-mails, and maybe home addresses leaked is one thing.  I could live with that and still use whatever company had that data leaked (and I probably have been in that situation already, unknowingly), but private keys being exposed to someone else?  That's a different beast entirely.  It doesn't even matter if a hacker could gain access to my private keys from Ledger, it's the fact that they can be gotten from the secure element from Ledger themselves that's turned me off from them entirely.

I guess my two Ledger devices are going into my growing HW wallet museum. 

As long as you only use it with (verified) Electrum, you should be good to go for many years. 

Is that really true?  I don't really understand the process by which private keys can be extracted from the Ledger device--do you have to be using Ledger Live for that to happen?  What if you have to update the bitcoin app?  And even if that is true that you can use Ledger with Electrum safely, you're still screwed if you hold any other coins aside from BTC, ones that need frequent updates to their apps to keep working.  A lot of folks hold more than just bitcoin, and I still think Ledger users are playing Russian roulette if they continue to use one of their devices.

[Synchronice]

I don't really understand the process by which private keys can be extracted from the Ledger device--do you have to be using Ledger Live for that to happen?  What if you have to update the bitcoin app? 

The problem here is that we were told by Ledger that it was impossible to extract seed from Ledger Wallet because Ledger devices protect your private key with a Secure Element chip. Then, out of nowhere, a new hardware update comes that allows Ledger Recover to access private keys. So, they were telling us that something like that was impossible but one day they come and say: It's possible only if you manually approve. So, that means, they have been lying since the very first day that means maybe our seeds are already extracted and stored somewhere on their servers, who knows? I am not so naive to believe that this seed extraction process 100% depends if I allow Ledger to do it or not, especially when they are closed source.