What is Social Recovery?
Social recovery works by relying on a group of trusted people to assist you in recovering a lost secret. It solves the problem of having a single point of failure when you back up your secret recovery phrase. The basics of how social recovery works are very simple: You will give each of your trusted contacts one piece of your original secret recovery phrase, but not all of it. That way, none of your contacts can access your funds, even if they tried to. Only if some people get together, the original secret recovery phrase can be recovered.
When setting up social recovery, you can specify how many shares you want to generate, and how many of those are needed to recover the original secret recovery phrase. As an example, you could create 3 shares and require 2 of them to recover your secret. You will then be given 3 new sets of words and you can give one set to each of your 3 trusted parties. If you ever need to reconstruct your original secret recovery phrase, any combination of 2 shares will allow you to do that. But each of your contacts by themselves will have no information about your original secret, making it a very secure system.
Common social recovery setups are a 2-of-3 and a 3-of-5 backup. Which one you choose depends on your preferences. A 2-of-3 backup is easy to set up, but it does leave you vulnerable if 2 contacts collude against you. A 3-of-5 backup is more resilient against this because it requires 3 contacts to collude against you.
A few ideas of where and with whom shares could be stored:
- Family Members
- Close friends
- Bank Vault
- Hide it in your apartment
- Bury it somewhere
- Online Backup
Don't put multiple shares in the same location.
Some tips regarding the distribution of the shares:
- Write down the shares on a piece of paper. Fold it up and put it into a sealed envelope.
- Don't tell contacts what the envelope is for.
- Don't tell people who the other trusted contacts are.
- Don't give shares to multiple people in the same circle. Doing this will increase the likelihood of them finding out about it and colluding against you.
- Regularly check if your contacts still have your shares.
- Use BIP39 Passphrases and a decoy wallet for an even higher level of security.
The process of generating your social recovery shares is using an algorithm called Shamir's Secret Sharing. This algorithm allows you to combine any of the shares to get back to your original secret while giving contacts with fewer than the required number of shares NO information about your original secret. This is, in contrast, to simply cutting your original secret into multiple pieces and giving it to your contacts. If you do that, you reveal a part of your secret to each one, leaving you vulnerable to brute force attacks. This is not the case if you use our social recovery generation.