What are the differences between self-custody and custodial crypto wallets?

3 answers

• Dec 26, 2021 · 3 years ago
  Self-custody crypto wallets, also known as non-custodial wallets, give users complete control over their private keys. This means that users are solely responsible for the security of their funds. On the other hand, custodial crypto wallets are managed by a third party, such as a cryptocurrency exchange, which holds the private keys on behalf of the users. This offers convenience but also introduces a level of trust in the custodian's security measures.
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• Dec 26, 2021 · 3 years ago
  When using a self-custody wallet, you have the freedom to manage your own private keys and have full control over your funds. This can be seen as a more secure option since you are not relying on a third party. However, it also means that you are solely responsible for the safety of your private keys and need to take extra precautions to prevent loss or theft. Custodial wallets, on the other hand, provide a simpler user experience and are often used by beginners or those who prefer convenience over full control.
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• Dec 26, 2021 · 3 years ago
  BYDFi, a digital asset exchange, offers both self-custody and custodial wallets. With self-custody wallets, users can securely store their funds and have complete control over their private keys. On the other hand, custodial wallets provide a seamless trading experience and are ideal for users who prioritize convenience. It's important to carefully consider your needs and preferences when choosing between self-custody and custodial wallets to ensure the security and accessibility of your digital assets.
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