Why is it Important to Use a Non-Custodial Crypto Wallet?
Non-custodial crypto wallets are a great choice for anyone who wants to be in full control of their funds, and at the same time, stay anonymous. Contrary to custodial wallets wherein the third party manages your private keys and funds, in non-custodial wallets, only you own the key and access to your crypto. This independence comes with several benefits that are detailed as follows.
Advantages of Non-Custodial Wallets
Unlike custodial crypto wallets with their centralized servers, non-custodial wallets do not store your private keys, which makes it difficult for hackers to compromise it. You personally possess your private keys alone, and no one can move or spend your assets without your knowledge and approval.
Non-custodial wallets’ priority is never to collect your personal data, which fosters full user anonymity and confidential transaction history. This privacy guarantees that your crypto activity is protected and not being disclosed to others, or even be tracked or leaked.
It is a fully transparent and personal method of handling funds and payments. You do not have to rely on intermediaries to withdraw or transfer your cryptocurrency. This autonomy is particularly important to avoid situations where funds end up frozen or access to them restricted by the custodial service.
NOW Wallet Functionality and Advantages
NOW Wallet is one of the examples of a non-custodial wallet with effective features and a list of advantages. It enables users to manage their crypto assets, purchase, swap, and stake, cryptocurrencies on both mobile and web applications. NOW Wallet has a wide range of options and supports more than 40 blockchains and thousands of tokens.
How Non-Custodial Wallets Work
NOW Wallet and other non-custodial wallets generate and store the private keys on users’ devices only. Also, the key creation process involves assigning a seed phrase or a recovery phrase, which is a backup in case the device with the wallet app is lost or damaged. This means that any given transaction is signed on the local node and the signed transaction format only is transmitted to the blockchain, with the private key kept offline and safely.
Benefits Over Custodial Wallets
Holding digital currency in a custodial wallet is not as secure and private as in a non-custodial wallet. From the user’s perspective, the private keys can be held in the custodial wallets by the exchanges or service providers, which means that the user is delegating control of crypto assets to the third party, and there will always be a central point that can be compromised, for example, through hacking attacks. Furthermore, it should be mentioned that the provision of services under consideration might be affected by regulations and restrictions that could freeze or restrict access to users’ funds.
In conclusion, the decentralized nature and the option to own a secure crypto wallet like NOW Wallet is safer, more private and gives the user more control over their respective cryptocurrencies.
