The main point of a seed phrase (ie. the mnemonic) is for the users to have a way to recover their money in case the device was damaged or lost or ... if that option is removed, then how are their users supposed to be able to recover their money?

I don't know but I think you should check critically if this email is actually from Keystone HW. I've been on their media handles and their official site for a while now trying to find the same message contained here without success. I believe such important shift in operation should be on their verified media channels as well and their website, so I'll advise you to take it with a pinch of salt until they announce it themselves... Remember Don't trust, but verify

If you cannot backup your seeds, then your funds is gone when the hardware wallet ceases to exist/function and the keys aren't yours but theirs since you don't have access to them. #NOT YOUR KEYS NOT YOUR COINS.

Can't find the article. It's these the blogs/information are being sent specifiq only for you as custome? they not make these public yet?

I've been searching for "seedless architecture"; they removed the option for recovery backup with 12/24 words, and the replacement could be via:

• Some registers, like emails or social media
• Threshold signature? MPC? like different private keys being merged into several pieces ^[source]

---

As a matter of fact, Keystone & Unipass made a merger, and in this article: https://www.prnewswire.com/news-releases/account-labs-emerges-from-unipass-and-keystone-merger-forging-ahead-in-web3-account-abstraction-301829206.html

They created a Seedless wallet by using the social media option as the backup or access without needed some private-key/mnemonic. Still scary, cause these can be more easily compromised.

I couldn’t find this news on their social media either, which makes me think their email provider might have been compromised or it’s a phishing email from a different domain. If their devices really are as tamper resistant as they claim to be, there isn’t a need to switch to something radically different that, in my opinion, is less user friendly. If your device were to stop working how is someone supposed to recover their coins? Even Tangem wallet, which is seedless has backups.

That’s also another bad idea from any company and will never make any sense to me in this context, backing up seed on google is total exposure of seed. I think would rather choose not to have the backup feature than to have to have it on google drive or some thing related.

First I would double check via official Keystone channels e.g. customer support, other than links in that message that it is in fact true, as I could not find such announcement in official communication channels of Keystone. Assuming its true, the big question is if seed based recovery is/will be still an option. I would not rush to upgrade firmware until thats clear. Such seedless wallets might use e.g. server assisted signing or MPC and other techniques, which have different assumptions regarding trust, recovery options etc. than regular seeds.

Make sure you have your recovery phrase backed up (offline of course!) and if Keystone discontinues the possibility to use regular seed, I would consider migrating funds to another device, which gives you sovereign recovery option, ideally a regular hw wallet compatible with BIP39 recovery phrases. Remember to never ever enter your seed in online wallet, even just to check if it works.

It is not the only hardware wallet that have gone for seedless wallet before, the first wallet that I remember that it was introduced was Tangem wallet which we discussed about on this forum.

https://tangem.com/en/learning-hub/post/seedless-wallets/
TANGEM WALLET: An Innovative Seedles Cold Wallet Setup

Their claim is that seed phrase users can be vulnerable to phishing attack.

But I do not like the idea of seedless wallet. At least, it can optional.

All the noncustodial wallets has private key.

It will have private keys.

It is better you differentiate between seed phrase and private keys. There can be noncustodial wallets that has no seed phrase, but all noncustodial wallets have private keys which is important for making transactions.

I tried to find official sources to verify this information but came up empty, neither on the official website nor even on news outlets. So if you have come across this news, please share the link so we can take a look at it too. A seed phrase is a crucial element of every wallet, as it maintains access to your coins. As of now, I am not aware of any other way to regain access to them.

Have you confirmed the genuineness of the source of this information? I strongly believe it's not true.

Keystone of all wallets shouldn't lead in this ignoble decision. If this is allowed, how would the users be able to import their address into another wallet? That's a decision that would start weakening crypto possession.

I will not be surprised if this turns out to be a high level Seed phrase scam as you have hinted.
This message might be accompanied by another message, telling the user to input their seed phrase in order to enable Keystone to synchronize the keys to the chip.

On a second thought, the mail looks genuine. Scammers will not give you enough time till 2027 to implement anything. The proven strategy of scammers is hastiness. Their timeframe is always short, persuading you to do it within a few hours or lose your funds