What's the difference between Custodial and Non-Custodial Wallets?
Crypto diffused control from the elites to the commoner. Using the blockchain as a reliable medium, crypto users are their banks. For this, they can determine how they want to use their funds, not relying on a third party who, as history shows, can't consistently beat the market.
At the heart of this liberation is a cryptocurrency wallet.
They are broadly categorized into custodial and non-custodial wallets.
A custodial wallet is one in which a third party controls the private key on behalf of the coin holder. On the other hand, a non-custodial wallet is one with which the holder knows the private key and can sign transactions, confirming ownership.
Most custodial wallets are hot—meaning they are connected to the internet. On the other hand, some non-custodial wallets might be linked to the internet—that is, they are hot but secure. All hardware wallets are non-custodial, and the user's responsibility is to safeguard its private key lest they lose access.
CryptoAltum's e-Wallet is custodial, and the exchange is tasked with securing the trader's private key once a deposit is made. The exchange is secure, and funds segregated. There is no time when users and exchange funds will mix. Equally, access requires multi-sig approval by different signatories.