New Ethereum upgrade makes loss of private keys a thing of the past

Ethereum is due for a new upgrade that may mean users no longer have to worry about losing their private keys. With crypto it is possible to take full control of the management of your capital, but the downside is that you are also responsible for its security and storage.

It is possible that users lose their private keys (and thus access to crypto). After this new upgrade of Ethereum, this may no longer be a danger.

How exactly is this possible on Ethereum?

This development is part of the Pectra hard fork, which should add a so-called “social recovery” component to Ethereum.

The disadvantage of this development is of course that users officially transfer their tokens to third parties. That’s not quite what Bitcoin and Ethereum were ever built for.

Ethereum Foundation researcher Domothy explains what the gears are in a blog on March 25. According to him, it is possible that the smart contracts in question will be stolen if users choose fraudulent management parties.

In principle, this mechanism is comparable to storing your crypto on an exchange platform. Handing over your responsibilities always has disadvantages.

Good for Ethereum mass adoption?

Crypto influencer Cygaar claims that this development could be huge for the mass adoption of Ethereum by private individuals.

This is how the 3074 flow works:

– User signs a message (off-chain, not a tx)
– User or sponsor sends the message to an invoker contract as a tx
– Invoker uses AUTH and AUTHCALL to verify and call each target contract with the user’s address as the sender pic.twitter.com/S0lLh0RnfT

— cygaar (@0xcygaar) April 11, 2024

The idea is that users no longer need to know exactly how everything works, but that the management party takes care of everything in the background. This could make it easier to use Ethereum for the average investor.

For now, the Pectra hard fork seems to be scheduled for the end of 2024 or the beginning of 2025. So we will have to wait a little longer for this upgrade for Vitalik Buterin’s Ethereum.

Would you consider using this mechanism for (part of) your capital?

Trade €10,000 for free and get a 10 euro bonus

Do you want to enter the crypto world and perhaps buy Ethereum or another crypto? Then grab your chance now with this exclusive offer! Thanks to a special deal between Newsbit and Bitvavo, one of the most accessible and user-friendly crypto exchanges in Europe, our readers receive an exclusive offer.

Create an account with Bitvavo via the button below and receive a welcome gift of 10 euros completely free. And that’s not all – you also don’t pay trading fees on your first 10,000 euros in transactions. Register now!