Bitcoin, while down from its all-time high, is still well above its previous highs over the past few years. And with any exponential rise in the price of BTC, the number of frantic people with bitcoin stashed somewhere in a crypto wallet protected by a password they’ve long since forgotten – well, that’s increased exponentially as well.
“These days because of the price rise and just the increased interest, we get around 50 to 70 requests daily,” he said. (For our interview we connected over a web chat service that doesn’t require user accounts, just a unique URL. Dave cares about his privacy and prefers an “ephemeral WebRTC conversation.”)
Wallet Recovery Services
Dave and his co-founder are equal partners of the company. They developed the software their company has used since 2013 as a hobby.
The proprietary software is essentially a brute force attack on your crypto wallet; it tries millions of passwords in quick succession. Run on Linux nodes hosted on AWS, the algorithms the software uses try a multitude of permutations of whatever potential password customers think might be associated with the wallet. This often works because unfortunately, people tend to reuse passwords, despite a host of reasons to not do so.
Early in their hobby days, Dave and his partner were posting in the Bitcointalk forum, offering their crypto wallet recovery services as something they were trying out.
“It was an excuse for us to learn about the tech and stuff like that,” said Dave. “And then what we've done is, over the years, we've developed our own software that lets us try variations of passwords based on the customer's guesses, and then added support for many different kinds of wallets over time.”
Day-to-day in a bull run
Even amid a bitcoin boom, Dave’s day-to-day might be recognizable to a lot of people – he spends a fair amount of time just answering questions via email from people who need help figuring out how to regain access to their crypto wallet.
“They'd be like, ‘Hey, I did a job once for someone two years ago and they paid me in bitcoin,’” said Dave. “'And I never really cared for it. But now I know I have bitcoin, but I don't know how to get to it. Can you help me?’”
He then evaluates those queries and helps people figure out whether their quest to reclaim their neglected bitcoin is possible. For example, if your seed phrase is lost, there isn’t a way for you to access your funds. He’ll be clear about that, warning prospective customers that if someone says they can get their funds back in that situation, they’re scammers.
He says that at times customers know their bitcoin is a lost cause. They’re really just looking for confirmation.
The inadvertent HODL
While there has been a ton of renewed interest in crypto recently and with a lot of focus on the whales holding huge treasure troves, most people who reach out to Dave don’t have high-value crypto wallets.
“For many of our customers, whether it's a few ether or .05 bitcoin, this amount of money could make a big difference in someone’s life. So we put a fair amount of effort into all wallets, regardless of their size,” said Dave.
Some people come to them years after thinking their wallets were lost because they didn’t know services like this existed. As for others, it may be that Dave's software has now had time to catch up to the problem. As the software gets better, the company may revisit wallets they were unable to access in the past.
“Whenever we add more stuff to our software, we'll go back and have a test by trial, testing 'pass or fail' on wallets every once in a while from, say, five years ago,” he said. “Sometimes [the software] finally solves it and we’ll email the customer and it's, like, it's a great surprise for them. Some have said that this actually ended up being a good thing for them or they would have sold it much earlier.”
Let’s call it the inadvertent HODL.
The crypto wallet risk
The fact of the matter is people who use Wallet Recovery Services are entrusting the company not to steal their cryptocurrency once they manage to hack into the wallet. But as Dave points out, the company has a long string of positive reviews; after all, the only way it could continue to exist is by maintaining its good reputation.
Dave also said he tells customers to change their passwords (because they usually use variations of the ones they give him) once he runs his tests.
Wallet Recovery Services takes 20% of the holdings of the crypto wallet as payment if they successfully access it.
“Historically, our success rate rate is about 35%,” he said. “So there's a 65% chance we won’t get anything out of the wallets that we work on, which we spend time and resources on.”
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.