Cryptocurrency is growing in popularity as investors get used to it, but there are fundamental differences from national currencies. The most notable difference is that instead of being based on an item of value such as gold or the credit of the nation backing it, cryptocurrencies are based on the difficulty of producing them. Today’s crypto is based on complex algorithms, but that also means they don’t need anything more than an encryption key and password.
This means that one of the strengths of cryptocurrency is that accessing your funds is easy. But imagine losing your password for your crypto wallet, thereby losing access to your funds. It happens a lot more often than you might think. According to Chris Brooks, CEO and founder of Crypto Asset Recovery, a company that helps people find their passwords, there are two types of digital wallets. The first is a self-custody wallet where “an individual holds their own private keys, and they’re essentially protected by encryption and a password,” Brooks explained. The second are custodial wallets, where companies or organizations hold the private keys and funds on behalf of the customer.
For people who hold wallets in self-custody, losing the password is a significant problem. The encryption is essentially the original private key; a long string of numbers and letters that is familiar to you, and you encrypt it with a password. If you lose this password, no one can reset it.
However, Crypto Asset Recovery may ask certain questions and generate millions – and sometimes even billions – of password variations based on your password guesses. And, if one of them is correct, they can decrypt your wallet, granting you access and the password that opened it.
“To perform a wallet recovery, we primarily need two things,” Brooks said. “The first is a wallet backup and it’s the encrypted copy of your private key. The second is your password guesses. Once we have those two things, the first thing we’re going to do is back up your wallet and we are going to apply a hashing algorithm to it.
Once they apply the hashtag algorithm, the Crypto Asset Recovery team will take the password guesses and feed them through their proprietary AI program to generate more password guesses. In other words, they take the original password guesses given to them by the client and extrapolate other guesses based on that. To do it right and decrypt your wallet, they need to be exactly right.
“The name of our game expands the key space we’re attacking and with our modifiers it’s tens of hundreds of millions of guesses until we find the right one,” Brooks said. “We crack at a rate of between 40,000 and 20,000,000 passwords per second. Even at this speed, it still comes down to being 100% on the money to find the password.
The combination of company strategy and technology means an average success rate of around fifty percent. While that may sound small, it’s not. Without them, a wallet owner has virtually no chance of accessing their funds.
The password recovery process actually works with more than cryptographic passwords. Whether it’s a digital wallet or something else with an encrypted password, Brooks recommends that since “people are creatures of habit, good hygiene is also important. passwords”. He said it was essential to store and save passwords in a safe place, for example by using a secure password manager, so that they are not lost in the future and can be recovered. if necessary.