Recently there has been a lot of confusion Changes to the BIP 85 repository. For those who are not familiar with BIP, it is a very simple scheme to allow the creation of new word seeds from a derivation path in your pre-existing word seed. The logic of BIP is to enable people who use multiple wallets to manage the chaos resulting from having to maintain individual, isolated backups of many wallets.
By generating new seeds based on the entropy of the derivation path, users can simply make a single backup copy of a “master” word seed, and from there are able to replenish any child seed of that master seed. One backup, and you can have as many independent word seeds as you want. It is also safe to transfer and import to different devices or wallets, and has no risk of compromising the master seed or any coins stored on it.
There is no cryptographic way to go back from the child seed to the master seed, even if it is hacked. This design makes it very secure to use multiple independent seeds/wallets, while simplifying the backup process to protect against loss.
The BIP has been updated to follow the pull request proposal which clarifies several things, but the main change was a change in how the actual subkeys are generated, ostensibly to follow the specification in BIP 32 (which details how to generate keys using high-precision derivation paths) which is not BIP 85 does it strictly. This would have created the same BIP 85 paths for different switches than they would under the current specification. This is a radical change.
If implemented in the new specification by any project, any old BIP 85 seeds that users have already created and sent money to will not be properly generated. This means that these funds will be “lost” in the sense that update wallets will no longer properly generate keys to get people’s funds if they lose a copy of the previously generated seed.
However, the truth is that no wallet would have implemented this feature, or if they had, they would have done so in a way that supports both methods, because they already had users in the world who created seeds using the old specifications. Wallets and hardware makers will not introduce a change that will only break users’ ability to redeem existing funds, and that is not in their best interest.
All this incident showed was a lack of communication, nothing more. There was no real risk of anything being torn apart to create real consequences that would impact users. Projects implementing BIP 85 did not make any changes, nothing happened except changing the technical document. It was even He came back to remove the change Right after the public backlash against the nature of the change, and the lack of communication between developers and projects actually implementing BIP.
People need to stop hyping up communications failures like this, which have no real consequences, such as cases of evil intent, or profound failures of competence. It was just a bug, something that can be learned from by improving communication between developers and project maintainers in the future, and didn’t cause any real harm to anyone.
Blowing up little hills in the mountains like this serves no one in this space, and does nothing to improve the real problems of communication and coordination in space. Getting the context right in a civil, productive way so people can learn is how we deal with these things.
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