Vitalik Buterin Warns: Lost Crypto Is a Bigger Problem Than Hacks

Buterin believes that personal losses due to forgotten passwords, lost devices, or lack of backups are just as concerning but often overlooked, while high-profile hacks often dominate the conversation—such as the recent $1.4 billion theft from Bybit $4.34B .

In a February 28 post on X, Buterin highlighted how easy it is to lose access to funds, "Software bug, forgotten password, lost device, paper wallet burned down in LA fire, upgraded device without backing up data ... lots of ways for that to happen".

Did you know?

Want to get smarter & wealthier with crypto?

Subscribe - We publish new crypto explainer videos every week!

How to Make Passive Money with NFT? (Explained!)

SUBSCRIBE

ON YOUTUBE

He also pointed out that many people feel too embarrassed to talk about these losses because they blame themselves.

For years, Buterin has been an advocate of social recovery—a method that allows users to regain access to their wallets with the help of trusted individuals or institutions.

In May 2024, He shared that he personally stores most of his crypto in a multisig Safe wallet, a system that requires multiple approvals to access funds.

Meanwhile, in January 2021, he proposed a system where “guardians” could step in when a user was locked out. These guardians could be friends, family members, or institutions, ensuring that assets remain accessible even if primary credentials are lost.

On February 27, MetaMask, a self-custody crypto wallet, shared its near-term product roadmap. What are they? Read the full story.