OneDrive Security

Nature of Sensitive Data
This is generally correct: OneDrive is not recommended for storing highly sensitive data such as seed phrases, Nostr (nsec1) private keys, keystore files, or exported 2FA codes. There are more secure alternatives for these critical uses.
Seed phrases, private keys, keystore files, and exported 2FA codes are critical elements that provide direct access to your funds, identities, or accounts. Their compromise results in irreversible loss, with no possibility of recovery.

OneDrive Security
OneDrive offers standard security with two-factor authentication, encryption in transit and at rest, and recovery tools. However, it does not use end-to-end encryption (zero-knowledge), which means that Microsoft could theoretically access your files.

Risks in case of compromise
If your OneDrive account is compromised (by phishing, malware, or a weak password), an attacker can access all your files, including your sensitive keys and codes. Unlike encrypted vaults, there is no additional barrier to protect these files.