Which features distinguish a custodial wallet from a non-custodial wallet in the realm of digital assets?

3 answers

• Dev adarshSep 15, 2023 · 2 years ago
  A custodial wallet is a type of digital wallet where a third party, such as a cryptocurrency exchange or a financial institution, holds the private keys of the user's digital assets. This means that the user does not have direct control over their funds and relies on the custodian to manage and secure their assets. On the other hand, a non-custodial wallet gives the user full control over their private keys and allows them to manage their digital assets independently. Non-custodial wallets are typically software wallets that can be installed on a user's device or accessed through a web browser.
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• Mansour Diagne JuniorJul 09, 2023 · 2 years ago
  When using a custodial wallet, the user usually needs to create an account with the custodian and go through a verification process. The custodian is responsible for storing and securing the private keys, as well as providing services such as transaction processing and account management. In contrast, with a non-custodial wallet, the user generates their own private keys and is solely responsible for their security. This gives users more control and ownership over their digital assets, but also requires them to take extra precautions to protect their private keys from loss or theft.
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• Oc bash101Jul 15, 2023 · 2 years ago
  At BYDFi, we believe in the power of non-custodial wallets. Non-custodial wallets offer users the freedom and control to manage their digital assets without relying on a third party. With a non-custodial wallet, users can securely store their private keys and have full control over their funds. This aligns with the decentralized nature of cryptocurrencies and provides users with a higher level of security and privacy. However, it's important to note that custodial wallets can still be a viable option for users who prefer the convenience and additional services provided by custodians.
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