What are the importance of this non_ custodial wallet?

[pawanjain]

I have been mean to ask this question, but it keeps skipping out of my mind. so I have decided to ask to know the importance of non_custodial wallet, because most investors prefer to use non custodial wallet to store most of their asset, why did they choose non custodial wallet when they are many wallet's out there to use in storing their assets? I keep hearing about non custodial wallet so I will like to know of which importance is this non custodial wallet to us as investors?

Non custodial wallets are basically like bank accounts but the fact that there is no 3rd party involved. You are the owner of that bank and you hold all your funds at your own risk.
So with non-custodial wallets you hold your coins at your own risk by securing the private key/seed phrase in a safe location.
This key/seed is the main access to your wallet and you have to make sure nobody else get to it any cost.

The benefit is that since there is no middle man involved, the chances of your coins getting stolen becomes slim.
If a bank goes bankrupt then you won't get to access your funds but if you are yourself the owner of your bank then you won't go bankrupt at first place.

[Pmalek]

Noncustodial wallets are the best wallets for storing your bitcoin, because no one can identify the owner of such wallets.

You are right to some degree. But one can still determine who uses a bitcoin address (of a non-custodial wallet) to a high certainty based on their spending habits. If that address keeps depositing and withdrawing to and from a centralized exchange where you have undergone KYC, chances are high it's the same person. Also, if you posted that address anywhere online where it can be connected with you real identity, it's the same thing.

The idea of writing your seed phrase on a sheet of paper or your device, or even trying to memorize it, is strongly discouraged, as this type of wallet comes with a lot of responsibility, but it's also the right choice.

The bolded part is not discouraged. It's the way it should be. Your keys should be stored offline on paper or metal. That's the only right choice. The rest is wrong and decreases the security of your keys and coins.

Using a non custodial wallet you have a total freedom to your assets and you are in control of your privacy.

You maintain your privacy by using privacy-enhancing tools. For instance, using TOR and connecting to your own node. Electrum is a non-custodial wallet, but it's not a privacy-focused wallet. The moment you connect to someone else's server, they will find out plenty of information about your bitcoin wallet.

[Upgrade00]

<snip>

You are right to some degree. But one can still determine who uses a bitcoin address (of a non-custodial wallet) to a high certainty based on their spending habits.

It is also not much different from most custodia addresses. Some wallets you log into using an email address and a password, there is not much one can use to identify you with that. Your identity is only easily exposed if you use a wallet which requires you to submit KYC and in such situation only those with access to the website logs can get personal information.

[SamReomo]

most investors prefer to use non custodial wallet to store most of their asset, why did they choose non custodial wallet when they are many wallet's out there to use in storing their assets?

When you know that you can safely keep your cash in your wallet then why would you keep it in the wallets of others? That's how non-custodial wallet works, you are the only owner of non-custodial wallet as long as you hold the private keys, while the rest of the wallets are custodial which mean someone else takes custody of your Bitcoin.

Investors always prefer to have control over their assets safely and that's why they keep their Bitcoin in non-custodial wallets. If you really want to be the owner of your Bitcoin then non-custodial wallets are way to do that. Those investors who keep their Bitcoin in custodial wallets are at high risk because the ones who take custody of their Bitcoin can do anything with that Bitcoin.

[Abu-Naim]

I have been mean to ask this question, but it keeps skipping out of my mind. so I have decided to ask to know the importance of non_custodial wallet, because most investors prefer to use non custodial wallet to store most of their asset, why did they choose non custodial wallet when they are many wallet's out there to use in storing their assets? I keep hearing about non custodial wallet so I will like to know of which importance is this non custodial wallet to us as investors?

For privacy sake, non custodial wallet is the best because you will have control of your assets in them, unlike custodial wallets where the wallets owners will own the right to your coins.
Private key is an important factor in non custodial wallets because if you have your private key stored in your custody, you can have access to your bitcoin at anytime since the private key is like the password/pin to your account.

Custodial wallets like exchanges have do have some problems along the line which can lead the exchanges to being bankrupt which may result to you as an investor to lose your savings with them.

Always remember this: Not your keys, not your coin.

[Bushdark]

I have been mean to ask this question, but it keeps skipping out of my mind. so I have decided to ask to know the importance of non_custodial wallet, because most investors prefer to use non custodial wallet to store most of their asset, why did they choose non custodial wallet when they are many wallet's out there to use in storing their assets? I keep hearing about non custodial wallet so I will like to know of which importance is this non custodial wallet to us as investors?

Non custodial wallet give you the ability to control your funds not like the exchange wallet or custodial that would keep your seed phrase for you making you not to have the full control of your wallet. Understanding the differences would safe you the stress so that you don't store your coins in a wallet where one day they could take your access to your account and you will not be able to withdraw your funds.
I have seen many investors which loses access to their coins because they could not have the seed phrase with them.

[Pmalek]

For privacy sake, non custodial wallet is the best because you will have control of your assets in them.

Being in control of your keys and coins is a security question, not a question of privacy. Non-custodial does not equal private. It can with the right wallet, but those two terms aren't synonyms. You can lose your privacy using non-custodial SPV wallets despite remaining in control of your keys.

[Kristiyana]

I have been mean to ask this question, but it keeps skipping out of my mind. so I have decided to ask to know the importance of non_custodial wallet, because most investors prefer to use non custodial wallet to store most of their asset, why did they choose non custodial wallet when they are many wallet's out there to use in storing their assets? I keep hearing about non custodial wallet so I will like to know of which importance is this non custodial wallet to us as investors?

Well ita like your own bank where you are the keeper and the only one can access too that vault. Its like a bank but you are the customer and the one handling it. No third party or no regulations on when you will withdraw or claim it. The risk is it can be breach if you dont take care of your own wallet or you associated with some viruses or some malicious threat.

Its more like self protection. Most prefer it than storing your asset on third party which could be compromise and you can do nothing about it.

Thank you so much for your information i think I have full knowledge about non custodial wallet, well with your explanations I think that's the best wallet to store our asset since we can have control over our asset's I think that's the best wallet instead of using exchange wallet. what did you think about this opinion? Instead of using a wallet that you won't have full control over your keys.

[Saint-loup]

I have been mean to ask this question, but it keeps skipping out of my mind. so I have decided to ask to know the importance of non_custodial wallet, because most investors prefer to use non custodial wallet to store most of their asset, why did they choose non custodial wallet when they are many wallet's out there to use in storing their assets? I keep hearing about non custodial wallet so I will like to know of which importance is this non custodial wallet to us as investors?

How do you know that? Where have you seen that most investors are doing that? I don't know what you call "investors", but I don't think many big investors are using non-custodial wallets. They can be easily stolen or hacked, or locked if the seeds are lost. It's not the safest solution for a solution for a big investor IMO, except if he's using multisig wallets eventually but it's as safe as storing millions dollars at home at least, nobody does that. They entrust their funds to the bank actually, it's the same for cryptos.

[Outhue]

Non custodial crypto wallets gives true ownership, out of banks and centralized entities, you are the only one in control of your assets, although non-custodial have a bad apple side, and that is some closed source wallet that still gives users access to private keys and recovery seed, but been closed source is red flag so yph need to do your own research on each Bitcoin wallet before using them.

An open source wallet comes with full tramsaprency, even if you are not good with codes there are people who are, you can ask them to help you check the codes if they truly it is transparent and safe but they can't know if the wallet is a closed source crypto wallet.

Right now, I look for more than non-custodial in a crypto wallet, it has to be fully open source and for my own security sake I still prefer air gapped wallet, so it should be three in one.

Air gapped.
Open- Source.
Non- custodial.

[AVE5]

Okay, I understood from the aim of the Op is to understand what non custodial wallet is and literally he/she does not have an ideal about the centralized wallets such as the exchange wallets.
I have think I've figured rightfully where he's headed up to.

So Op, non custodial wallets are those Crypto wallets that the crypto holders are responsible in a private modelitty of being in charge of their assets by coded generations of seed phrases for security gadgets to personal stay in control to their assets which is in the non custodial wallet.
The non custodial wallets doesn't demand the processes of KYCs which could keep an investor or a crypto trader on track with their asset transactions.
While the centralized exchange wallets are wallets that deemed not to given a 100% access to your assets private security keys because you can be under watch and trackable with the demands of KYCs to enable p2p transaction in exchange of trading with the centralized currencies such as the fiats.

So people chooses to store their assets in the non custodial because they needed to be sure that they security of their assets is under their control with the seed phrase which the centralized wallets are exemptional to the security and private features.

[Fiasem20]

I have been mean to ask this question, but it keeps skipping out of my mind. so I have decided to ask to know the importance of non_custodial wallet, because most investors prefer to use non custodial wallet to store most of their asset, why did they choose non custodial wallet when they are many wallet's out there to use in storing their assets? I keep hearing about non custodial wallet so I will like to know of which importance is this non custodial wallet to us as investors?

A non custodial wallet is a digitalized wallet where you have full control over asset with your private key/seed phrase at your own risk.A non custodial wallet is one of the safest wallet to store your asset as you have the full control over it.Since a non custodial wallet can be accessed and controlled from a generated private key/seed phrase,no information about your private keys should be disclosed to anyone,once your seed phrase is disclosed to a hacker,the hacker will be able to access your wallet and withdraw all your coin.So non custodial wallet is at the user's own risk.

[CryptSafe]

At first you should know that as an investor, the safety of your assets and funds matters.  So in that case, it is advisable to store such in a safe place where it is well protected.

Some investors prefer self custodial wallet while some would opt for third party exchange for their services but however be the case your assets would be stored and kept for you but it would be much more secured and safe when under your custody.

If your assets are under your custody, you are rest assured of your assets safety, you have instant access to your assets whenever and wherever you are. You are not under any obligation or whatsoever as a result of any out come or uproars from exchange possibly as a result of hack or data breaches.

I can say that holding your assets yourself is very much fulfilling than entrusting it to third parties or otherwise.

Remember the slogan " Not your keys, Not your coin."