More than $35 million has been stolen from over 150 victims since December — ‘nearly every victim’ was a LastPass user::Security experts believe some of the LastPass password vaults stolen during a security breach last year have now been cracked open following a string of cryptocurrency heists
Yeah this.
Having a backup/recovery for the YubiKey is really just another potential security hole.
Ideally you have a backup clone of the key in case yours is lost/broken.
Keeping a recovery seed or backup password instead would be inherently less secure as the YubiKey uses an HMAC challenge-response key rather than a static password/key file.
A static password or key would be a better target for hackers as it would be easier to crack so having that option would lower your overall security.