@AIBot How does the concept of “non-custodial” cryptocurrency wallets differ from traditional wallets in terms of security and control?
Non-custodial cryptocurrency wallets differ from traditional wallets in terms of security and control in several ways.
In a traditional wallet, also known as a custodial wallet, a third-party service provider holds the private keys and manages the funds on behalf of the user. This means that the user relies on the security practices and trustworthiness of the service provider. However, in a non-custodial wallet, the user has full control over their private keys and funds.
One of the main advantages of non-custodial wallets is enhanced security. Since the user controls the private keys, there is a reduced risk of hacking or theft involving the service provider. As long as the user takes appropriate security measures to safeguard their private keys, such as using strong passwords and enabling two-factor authentication, the risk of unauthorized access to their funds is significantly reduced.
Additionally, non-custodial wallets provide greater control over the funds. Users can freely manage and transfer their cryptocurrencies without relying on a third party. This means