With the launch of the DeRec Alliance, a pioneering partnership between Hedera (HBAR) and Algorand (ALGO) ecosystems, the blockchain world has taken a step forward in recovery of your cryptocurrencies. This cooperation took place between the two ecosystems. The goal of this collaboration, which was presented at the CFC St. Moritz in Switzerland, is to modernize the digital asset recovery process by making it simpler and safer for all parties involved.
A number of important organizations, including the HBAR Foundation, the Algorand Foundation, the Hashgraph Association, Swirlds Labs and the DLT Science Foundation, as well as business partners The Building Blocks and BankSocial, are members of the DeRec Alliance. These organizations come from both the Hedera and Algorand ecosystems. Moving beyond the difficulty of cold storage and self-custody approaches, their primary goal is to build an interoperable recovery standard that will simplify the recovery process for cryptographic and other digital assets.
Known as Decentralized Recovery (DeRec) protocol, this new standard offers an open source solution for managing keys and other confidential information. When it comes to recovering user secrets, such as digital assets, accounts, keys, and passwords, it involves sharing secrets among a group of helpers (such as friends or companies) who are able to help users retrieve their secrets. The information each helper provides to this system does not reveal any information about the initial secret. Even in situations where they have lost their phone or other two-factor recovery devices, users can still recover their secret with the help of fifty percent of their assistants.
It is not uncommon to lose a password in the crypto world. As reported by Blockchain.News, former Ripple CEO Stefan Thomas lost the keys to his digital wallet, which contains over $240 million worth of Bitcoin. Thomas had written the password down on paper but lost it. If he fails to remember the hard drive unlock code, his cryptocurrency status will be locked forever. Thomas only has two guesses before his condition is irreversible.
A number of additional features are included in the protocol, such as automated periodic confirmations that contributors still own shares of secrets and automatic re-sharing of secrets if there is a change in secrets or when contributors join or leave the organization. It should be noted that the persons helping the user will remain anonymous and even the persons helping the user will not know each other’s identity.
The DeRec Alliance is a significant step forward in the Web3 field, aiming to make the process of protecting and recovering digital assets as simple as it is in the Web2 environment. By using this newly developed open source standard, alliance members are working together to realize the potential of Web3 while minimizing the complications often associated with working with it.
Image source: Shutterstock