‘There are over $100 billion lost in crypto,’ says KeychainX CEO

With the growing number of wallets, blockchains and users the industry sees every month, the question of security becomes a top priority for the users.

We talked to Robert Rhodin, the CEO of a crypto wallet recovery service KeychainX, about an unexpected discovery that became the solution crypto wallet users had been starving for.

Tell us about Keychainx. When and why did you decide to launch the company and what kind of services do you provide?

It started in 2017 when a friend's Ledger stopped working and they asked me to help them recover 150 ETH.

After going through different forums, I realized it wasn't just my friend, and it wasn't only a Ledger problem. People were clueless about what to do with the Ethereum (ETH) presale wallets, Blockchain.com Wallets and old Multibit classic wallets. The issues the users had were not only forgotten passwords but also various bugs and discontinued releases.

Shortly after, a friend of mine from Los Angeles was looking for a business idea to invest in, and after they heard about these wallet issues, they decided to invest in a seed round. And KeychainX LLC was born.

Our main focus is to recover lost cryptocurrencies from people all around the world. But after relocating from the U.S. to Zug, Switzerland in November this year, we’ve also started to develop a patent pending keyless crypto wallet.

Who is your typical client?

The obvious answer is a crypto wallet owner who lost their keys.

We could probably divide them into three categories. The early investor who had a wallet for a very long time and suddenly realized the few hundred bucks were now worth millions.

The second client category is someone who recently bought some coins but never backed up their seed. All they have is an encrypted wallet. And the third category, which seems to be a growing number of clients, is the relatives of a deceased family member who left a crypto fortune after them that the relatives have no idea how to recover.

What is the biggest amount of cryptocurrency you’ve ever recovered?

We are bound by our NDA, but I would say it's not less than seven figures and our assets under management (AUM) in encrypted wallets is close to $2 billion. I believe there is more than $100 billion currently lost in cryptocurrency.

What does a typical chain of action look like when recovering a wallet?

It involves several steps from making sure the client is the owner of the wallet, then we sign an NDA with the client stating the terms of the recovery. After that, we conduct an interview asking for various clues to the hints or password guesses. Finally, we reserve a certain amount of servers depending on the wallet value and wallet type.

Different wallets require different hardware setups (like GPU or CPU server clusters). And, of course, there are new wallets with an ever-growing list of new blockchains and wallet encryption types coming out on the market that we need to amend our algorithms to.

What kind of wallets do you work with?

We work with all wallets, but mainly Bitcoin (BTC), Dogecoin (DOGE) and Ethereum (ETH). A growing number of users of Solana (SOL) and Cardano (ADA) wallets have been contacting us this year, as both blockchains have increased their activities.

We also do hardware wallets like Ledger or Trezor that had the passphrase or part of the seed lost. We can probably recover up to four missing words out of a 12 or 24-word seed. We have also done several recoveries from broken hard drives, broken phones or locked MacBooks or PCs.

A very common problem is people who get locked out after their face ID stops working or accidentally switch phones without backing up their seed or wallet data.

How are you different from your competitors?

I believe there is no real competitor as of yet that does the kind of work we do with the backup in financial terms and computer power. We are registered in a regulated market, have an NDA developed by a crypto law firm MME Legal in Zurich and actively exhibit and talk at conferences worldwide.

Personally, I would never send my wallet to an anonymous service, a family shop or a one-man show that does not even register their business. After all, you want to know who you do business with and who deals with your private keys when that wallet is finally recovered.

Talk to us about your team: what kind of experience do they have?

Our team is divided into several categories depending on their task. We have marketing and clients teams who respond to emails and travel to various conferences like Token 2049, AIBC Summit, Rome Blockchain week or, lately, Blockchain Conference in Hamburg, Germany.

We do also have a set of programmers who are specialized in various algorithms or GPU systems like NVIDIAs CUDA technology or conducting CPU tasks for high-intensity wallet encryptions like Ethereum v3 or BIP38 wallets.

What has been your biggest achievement so far?

Our most exciting achievement in terms of the number of wallets would probably be by opening close to 10 wallets on a single day, but having opened over 200 wallets in the last year alone and some from 2012 is a real heart-pumping experience.

Our biggest achievement is yet to come as we have some really big mega wallets that are due to be opened in the next year of 2022.

What does the future hold for KeychainX?

We have two roadmaps aside from an accelerating list of wallets and blockchains.

First, the development of custom ASIC boards to increase the speed of cracking wallets, and second, the development of our keyless crypto wallet, which is patent pending since 2019. It has social recovery, geographical location salt and various other implementations like timelock transactions and NFT ownership verification.