As of yesterday, users using a Coinbase Wallet can now back up an encrypted version of their private keys to their personal cloud storage account. These accounts include either iCloud or Google Drive. Coinbase released this announcement via its personal blog yesterday.
Coinbase Wallet Upgrades
🔐☁️ Introducing Cloud Backup for your private keys on Coinbase Wallet!
Backup to your personal iCloud or Google Drive, and explore the open financial system with peace of mind. https://t.co/6uaHT8AZky
— Coinbase Wallet (@CoinbaseWallet) February 12, 2019
This new feature is making many within the cryptocurrency community scratch their heads. Coinbase states that the Coinbase Wallet cloud back-up feature is completely optional. The company also explained that the backup is encrypted using a user-provided password with AES-256-CCM encryption. Coinbase claims that this backup is accessible on the Coinbase Wallet.
Coinbase explains their reasoning behind this latest feature:
“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. Now, with cloud backup, we give you the ability to store an encrypted copy of your recovery phrase on your personal cloud account. You will only have to remember a password, that you decide, in order to recover your funds.”
Coinbase Wallet Backlash
Not everyone seems thrilled about the latest feature, though.
i’ve always wanted to store my private keys on servers in china. where do i sign up!
— James (@chasing_ducats) February 12, 2019
Other crypto investors said:
— PonderJaunt (@PonderJaunt) February 13, 2019
Given the number of hacks that have occurred with hot wallets since cryptocurrency hit mainstream news in 2017, I don’t blame their hesitation. Coinbase Wallet plans on supporting other clouds in the future.
With the amount of negative feedback the company has received from the new feature, it remains unknown if they will continue with it. Luckily, this option is a choice. If it wasn’t, I could see a lot of investors ditching the Coinbase Wallet altogether.
While losing private keys can be a scary thing, investors seem more concerned with the centralized cloud backup. At the end of the Coinbase blog post, the company asks for feedback. “Your feedback helps us make Wallet better for everyone,” the blog post concludes.
It remains unknown if the Twitter warriors will keep their comments on the social media platform or if they will productively reach out to Coinbase with their concerns. What are your thoughts?
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