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September 21, 2023

Social Recovery 101

By: Soul Wallet


Ethereum is constantly growing and evolving but one term has been steadily gaining traction: social recovery. At its core, social recovery wallets like Soul Wallet are a groundbreaking approach to ensuring that you can regain access to your wallet. It's a testament to the Ethereum community's commitment to innovation, always seeking ways to enhance user experience and security.

For anyone who has delved into the realm of Ethereum, the importance of safeguarding one's digital wallet is paramount. Traditional methods, such as seed phrases or centralized custodians, have been the go-to solution for years. However, they come with their own set of challenges. From the fear of misplacing a written-down seed phrase to the vulnerabilities of centralized systems, the quest for a foolproof recovery method has been ongoing.

If you're wondering "What is Social Recovery?; you came to the right place. This article aims to shed light on the concept of social recovery while clarifying its mechanics, benefits, and potential risks, and even looking at a real-world example to help you easily understand social recovery. Whether you're a seasoned Ethereum enthusiast or a newcomer curious about the latest in wallet security, this article promises to offer valuable insights.

The Evolution of Wallet Security

As the Ethereum landscape has expanded and matured, so too have the challenges surrounding wallet setup & security. In the early days of Bitcoin and Ethereum, enthusiasts were navigating uncharted waters, often learning about security through trial and error. These initial steps were marked by both innovation and vulnerability.

Traditional recovery methods emerged as foundational pillars in this nascent stage. Seed phrases (also known as Recovery Phrases), a series of words that can restore access to one's digital assets, became the gold standard for wallet recovery. On the other hand, centralized custodians—which are entities that hold and safeguard a user's private keys—offered a different approach, promising ease of use at the expense of full user control.

However, these methods have their pitfalls. The Ethereum community has witnessed heart-wrenching stories of individuals losing access to their assets. Some lost their seed phrases in boating accidents, while others fell victim to sophisticated hacks targeting centralized platforms. For instance, the infamous Mt. Gox hack in 2014 saw the loss of almost 1 million Bitcoin, underscoring the vulnerabilities inherent in centralized systems.

Understanding Seed Phrases (Recovery Phrases)

At the heart of most Ethereum wallets is the seed phrase—a unique set of words that acts as a cryptographic key to a user's digital treasures. You can think about this as like a key to your mailbox, you want to keep it safe, not lose it and not let anyone make copies of it. These words, when arranged in a specific order, can restore access to your wallet, making them both a powerful tool and a potential vulnerability.

Given their significance, the storage of seed phrases becomes a matter of utmost importance. Common methods include jotting them down on paper, storing them in digital password managers, or even engraving them on metal for added durability. Each method, while offering certain advantages, comes with its own set of risks. Paper can degrade or get lost, digital storage can easily be leaked to malicious hackers, and metals, though durable, can still be misplaced or stolen.

Complicating matters is inherent human nature. We often gravitate towards convenience, sometimes at the expense of security. For instance, storing a seed phrase on a frequently accessed device might seem practical, but it exposes you to a myriad of potential threats. Similarly, keeping a written seed phrase in an easily accessible location might save a few minutes during access but could lead to catastrophic losses if it falls into the wrong hands.

Before we dive into social recovery, it's essential to understand these traditional methods and their challenges, setting the stage for the innovative solution that lies ahead.

The Rise of Social Recovery

In the ever-evolving world of Ethereum, the quest for more secure and user-friendly crypto wallet recovery methods has given birth to an innovative solution: social recovery. At its core, social recovery leverages trusted friends/family, institutional relationships, or additional wallets you have access to, in order to activate recovery of a wallet. This approach is inherently non-custodial, meaning you retain full control over your assets without relying on a centralized entity or single point of failure. Social recovery is one of the core features behind Soul Wallet.

What sets social recovery apart from traditional methods is its blend of human trust and cryptographic security. Instead of solely relying on a string of words or a single centralized entity, you can designate trusted individuals or entities, often referred to as "guardians," to assist in the recovery process. This fusion of technology and decentralized trust creates a more resilient and intuitive recovery system for an Ethereum wallet.

The potential of social recovery hasn't gone unnoticed. Ethereum's co-founder, Vitalik Buterin, has said "Social recovery is better" as compared to legacy seed phrase user experience.

Basics of Social Recovery Wallets

Diving deeper into the workings of social recovery wallets reveals a blend of technology and decentralized trust. Here's a closer look at the important pieces of social recovery wallets.

  • Guardians and Guardians: At the heart of the social recovery process are the guardians. These can be friends, family, trusted institutions or even other Ethereum wallets you have access to. These guardians play a pivotal role in verifying the user's identity and facilitating wallet recovery in the case of loss or theft.
  • Flexibility and Customization: One of the standout features of social recovery is its adaptability. You can decide on the number of guardians you wish to appoint, but also the required number of guardians that need to approve a recovery request. For instance, you can set a total of five guardians, but require three to actually approve the recovery request. This ensures security while providing flexibility.
  • Cryptographic Techniques: Beyond the human element, social recovery wallets like Soul Wallet employ advanced cryptographic techniques to ensure security and allow for privacy. Shared secrets, split among your guardians, ensure that no single guardian has complete access, and only when partially (or completely) combined can these secrets facilitate wallet recovery.
  • Decentralized Trust: Unlike traditional methods that might rely on a single point of trust, social recovery distributes this trust. This distribution not only minimizes risks but also aligns with the decentralized ethos of the broader Ethereum ecosystem and its associated benefits.

As we continue our exploration on social recovery, it will become increasingly evident that social recovery wallets represent a significant leap forward, offering a more holistic and human-friendly approach to the age-old challenge of Ethereum wallet security.

Setting Up and Using Social Recovery Wallets

Setting up a social recovery wallet is a straightforward process that revolves around trust. In essence, you nominate a set of guardians—these can be friends, family, or even other wallets you own. These guardians are then entrusted with the responsibility of aiding in the wallet's recovery, should the need arise.

The user experience is designed to be intuitive. At Soul Wallet, we guide you step-by-step, from selecting guardians to understanding their role. Recovery, when needed, is equally streamlined. Instead of fumbling with seed phrases, you simply initiate a recovery request and contact your guardians. Your guardians then verify the request, and once the required majority approves, your wallet access is restored and anyone who had access before (in the case of loss or theft) is revoked. The entire process underscores the elimination of cumbersome seed phrases, making it more user-friendly and less prone to human error.

Benefits and Advantages

Social recovery wallets are not just a novel concept; they bring a plethora of benefits to the table:

  1. Enhanced Security: By distributing the recovery process among multiple guardians, the risk associated with a single point of failure is drastically reduced.
  2. Improved User Experience: Gone are the days of scribbling down or memorizing long cryptic seed phrases. With social recovery, the process is more intuitive, leaning on trusted relationships and/or wallets.
  3. Avoids Isolated Risk Traditional recovery methods often put immense pressure on a single recovery key or phrase. Social recovery distributes this responsibility, reducing risks.
  4. Driving Adoption: For many, the world of Ethereum can seem daunting. The simplicity and trust-based approach of social recovery can make the entry barrier lower, potentially driving broader adoption of cryptocurrencies. Everyone has a friend or family member they can trust, and if not, you can use your other Ethereum wallets as your guardians!

Risks, Concerns, and Mitigation

While social recovery offers numerous advantages, it's essential to be aware of potential risks:

  • Trust Issues: The system's foundation is trust. If guardians turn malicious or are compromised, they could collude to steal funds from your wallet.
  • Potential for Coercion: With guardians known to the user, there's a risk, albeit small, of coercion or force (for example, by a Government entity) to approve a fraudulent recovery.
  • Privacy Concerns: By involving personal contacts, some might feel they're compromising on privacy. Luckily at Soul Wallet, we allow you to setup anonymous guardians.

To mitigate these risks:

  • Diversify Guardians: Try using guardians from all walks of life, including friends and family that don’t know each other. In addition, perhaps a wallet that you have access to. Overtime, there will likely be trusted private services that will act as a guardian for a small fee.
  • Regularly Review and Update: Periodically review your list of guardians and make changes if relationships change or if you have security concerns.
  • Educate Guardians: Ensure that your guardians understand their role and the importance of security.
  • Consider Private Guardians: Soul Wallet allows you to keep your guardians private, which gives you greater privacy and security.

By being proactive and understanding the nuances of social recovery, you can enjoy the benefits while minimizing potential risks.

Real-world Implementations and Case Studies

In the rapidly evolving world of Ethereum, a few other wallet providers have embraced the concept of social recovery. Each of these platforms offers a unique blend of features and user experiences tailored to the needs of their user base. Argent, for instance, is lauded for its user-friendly interface but as a more centralized solution, while Gnosis Safe stands out as the trusted multi-sig (not social recovery) wallet with a primary focus for businesses and DAOs. Soul Wallet stands in the middle, we pride ourselves on making Ethereum easy and secure for everyone, but while still being decentralized.

The real value of social recovery shines through in real-life scenarios. Consider the case of Alex. After setting up his Soul Wallet, Alex chose three guardians: one of his hot wallets, his best friend, and his significant other. He set up the recovery process to require approval from at least two out of the three guardians. Unfortunately, during a boating trip, Alex lost access to his Soul Wallet and his hot wallet (which was a guardian). Distraught, he turned to his remaining guardians. With the swift cooperation of his best friend and significant other, Alex was able to regain access to his assets, all without the need for a seed phrase. This incident not only reinforced the value of social recovery but also showcased its practicality in real-world situations.

The Future of Social Recovery

The horizon of social recovery is ever evolving. As the crypto industry matures, the integration of novel technologies, such as state syncing across multiple layer 2's through L1 state root, will further enhance the user experience of social recovery. In addition, there is lots of exciting work being done in the world of passkeys, which will allow you to use FIDO2 protocols (like Yubikeys), biometric devices (like Apple Face ID) and even web2 identity solutions (like a Google Account). Ethereum experts predict a potential surge in the mainstream adoption of social recovery, driven by its user-centric approach and the growing need for enhanced security in the Ethereum ecosystem.

Reflecting on Past Attempts and Lessons Learned

The journey of social recovery hasn't been without its bumps. Ledger made an attempt at introducing a recovery service that serves as an important example. While their intentions were noble, their solution was highly centralized and not transparent, which raised concerns. Many in the Ethereum community felt that entrusting a centralized entity with recovery contradicted the very ethos of decentralization that Ethereum stands for. The backlash was swift, with many losing trust in Ledger.

This episode underscores the importance of decentralization in the realm of Ethereum wallet security. Soul Wallet's approach, seeking full decentralization, transparency and open-source, aligns with the community's expectations and values. We hope to serve as a beacon, highlighting the path forward: a world where security is both robust and user-centric, without compromising on the principles of decentralization.


Social recovery is more than just a novel concept; it's a testament to the Ethereum community's relentless pursuit of innovation and security. The potential of social recovery to revolutionize wallet security is large, and may help bring in the next 100 million Ethereum users. We hope you stay informed, prioritize your digital asset security, and see if social recovery is a good fit for you. As the Ethereum landscape continues to evolve, community-driven platforms like Soul Wallet will play a pivotal role. The invitation is open to all: join the Soul Wallet community, contribute to its open-source code, and be part of the next chapter in Ethereum wallet history.