What are the differences between a custodial wallet and a non custodial wallet like Robinhood?

3 answers

• Mar 23, 2022 · 3 years ago
  A custodial wallet is a type of wallet where a third party, such as an exchange, holds and manages your private keys on your behalf. This means that you don't have full control over your funds and you need to trust the custodian to keep your assets safe. On the other hand, a non custodial wallet like Robinhood gives you full control over your private keys, allowing you to have complete ownership and responsibility for your funds. While custodial wallets offer convenience and ease of use, they also come with the risk of the custodian being hacked or going bankrupt. Non custodial wallets, on the other hand, provide enhanced security and privacy, but require users to take full responsibility for the safety of their own private keys.
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• Mar 23, 2022 · 3 years ago
  When it comes to custodial wallets, the custodian holds and manages your private keys, which means that they have control over your funds. This can be convenient for users who prefer to have someone else handle the technical aspects of managing their wallets. However, it also means that you have to trust the custodian to keep your funds safe. On the other hand, non custodial wallets like Robinhood give you full control over your private keys, which means that you have complete ownership and responsibility for your funds. While this may require more technical knowledge and responsibility, it also provides enhanced security and privacy.
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• Mar 23, 2022 · 3 years ago
  BYDFi, a popular decentralized exchange, offers a non custodial wallet solution that allows users to have full control over their private keys. With BYDFi's wallet, users can securely store and manage their digital assets without relying on a third party custodian. This gives users the peace of mind knowing that they have complete ownership and control over their funds. However, it's important to note that non custodial wallets also require users to take full responsibility for the safety of their private keys. It's crucial to properly secure and backup your private keys to avoid any potential loss of funds.
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