Custodial vs. Noncustodial Wallets: Which Should You Use?

As wallets continue to evolve from a simple store-of-value product to a critical infrastructure component and passport that underpins everything in web3, we examine what to look for as you explore the next iteration of the internet.

When you're investing in cryptocurrency, the right wallet is essential. Crypto wallets help to keep your assets safe by ensuring that only authorized people can access the funds. However, it can take a little time to choose the best type of wallet for you. 

Most crypto wallets can be categorized as either custodial or noncustodial. Both styles have their own pros and cons, so the right choice really just depends on your situation. To choose the best type of wallet for your needs, explore this helpful guide.

What Is a Custodial Crypto Wallet?

A custodial crypto wallet is a type of crypto wallet for which a third party holds onto the private keys for the customer. The owner of the crypto can send or receive payments, but they do not manage their keys themselves.