If you have been in the cryptocurrency space for a while, you have probably heard that if you don’t own or have your private keys in your possession, those coins or tokens don’t belong to you. Usually this is said when people leave large sums of Cryptocurrency in the exchanges. When you really look at that statement, it is really universal in the Cryptocurrency space. We have heard stories of people at the early stages of Cryptocurrency, storing their private keys in a computer or even on paper to find out that they accidentally recycled the computer or threw the paper away. I read a story about a guy in the UK who had mined 7,500 Bitcoins on his computer and somehow it ended up in a recycled yard. He has been trying to get the council in that area to allow him look for it in the recycle yard to no avail. At the time of this writing, that 7,500 Bitcoins is worth around $50 million dollars. Ouch!!!
In most Cryptocurrencies, when your private keys get stolen, compromised, or lost, your coins or tokens are gone forever. From statistics about 4 million Bitcoins will never be accessed because people lost or have forgotten their private keys. These Bitcoins are lost forever just floating around in Bitcoin heaven or may be Bitcoin “hell” for people that lost them (that’s probably how those that lost them really feel about the lost Bitcoins because of the value today). The worst part of this is that not only are their coins lost forever, they cannot also access the coins from the forks of Bitcoin that has happened since then which is really a double whammy!
When the EOSIO software was being built, it factored in the issue of people’s private keys getting lost or stolen so it put in place mechanisms for people to be able to recover their tokens. Some of the mechanisms became controversial like the freezing of people’s accounts when people contacted EOS arbitrators about their tokens being stolen or moved without their authorization. The high fees that were being asked for people to get their tokens unfrozen also rubbed lots of people the wrong way. Anyway, that is a topic for another day. Before the EOS snapshot that happened in June, 2018, scammers using phishing schemes, were able to steal people’s EOS tokens when they were still ERC20 tokens. Also some people lost or forgot their EOS private keys and so are still not able to access their EOS tokens to date. So how does Telos factor into all this?
In the forks of most coins, once your private keys have been lost, stolen, or compromised you can kiss any coins you could have received from those forks good bye, but not with the Telos fork. Think about the person that lost the 7,500 Bitcoins ($50 Million dollars); he not only lost that but also lost 7,500 Bitcoin Cash coins ($3.63 Million dollars), Bitcoin Gold coins ($166,875), etc. Whereas in the case of Bitcoin and most Cryptocurrencies where those forked coins are lost forever, Telos has devised processes and mechanisms for people to be able to participate in the Telos fork even though their private keys were compromised, stolen or lost in the EOS genesis snapshot. To be clear, Telos can only protect lost or compromised genesis accounts on the Telos blockchain. Unfortunately, Telos has no power to aid lost key issues on EOS accounts. Below is a link that goes into more details. Enjoy!
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