What Happened on May. 16th | Ledger's New Function Spur Controversy

In Ledger's new upgrade version 2.2.1, the hardware wallet company introduced a new function called Ledger Recover. If users enable this function, Ledger will encrypt your seed phrases using cryptography and send it to different entities that can then reconstruct seed for you. This is a ID-based key recovery service that provides a backup for secret recovery phrases.

Whilst the intention is good, this method poses several risk factors for users. Mudit Gupta, the Chief Information Security Officer of Polygon, pointed out on Twitter.

Firstly, the encrypted keys parts are sent to 3 entities and they can reconstruct the keys, but the implementation details about who these entities are seem unclear. Secondly, Ledger uses ID verification to confirm your request for key reconstruction. Identity theft is relatively easy and quite common, making this not a secure method.

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Headlines

US SEC Claims It Has No Obligation to Release New Crypto Regulations: The U.S. Securities and Exchange Commission (SEC) has given responses to Coinbase's petition for formal rulemaking in the digital assets sector on the court, claiming that it has no obligation to issue new regulations and Coinbase has no standing to sue it.

Justin Sun Tackles Leon Li's Brother, to Burn the $HT He 'Received for Free': Justin Sun tweeted today that Huobi founder Leon Li's brother Li Wei had repeatedly acquired a large amount of zero-cost $HT through abnormal means, and repeatedly sold and made huge withdrawals within the Huobi platform.

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Fundraising

Animoca Ventures Raising Second Early-stage Venture Fund

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