Bitcoin or other cryptocurrencies are complicated for new users, and the term “non-custodial wallet” also looks complex. Still, this reading will clear you of all the doubts about this digital coin and the non-custodial wallet. First of all, we need a piece of brief information about the bitcoin technology given below.
Bitcoin in Brief
The proper digitalization started after 2008 because bitcoin began at that time. After a couple of years, it became high in popularity worldwide, and people started using this technology till now. Almost all businessmen and ordinary people use technology and do online transactions to buy and sell goods and services. Bitcoin is a non-touchable coin that exists only on the blockchain (storing platform on the internet) and is easy to use, like domestic money.
Introduction of bitcoin wallet
Bitcoin wallet is a system for sending, receiving, holding digital coins on the internet with no involvement of third parties.
We use leather or metal purses to store the paper notes/coins in our physical life, but in our digital life, we need wallets to store, send and receive currency virtually. Hence bitcoin wallets are essential; otherwise, it is impossible to use bitcoin or other cryptocurrencies.
What is a non-custodial bitcoin wallet?
Non-custodial bitcoin wallet means using the bitcoin wallet without the custody of any third individual, group of individuals and company. So in simple words, these types of wallets are independent wallets which means only you are the controller manager of your purse, and no one will be responsible for storing, sending and receiving your bitcoins. bitcoin pro is opposite the non-custodial wallet. You can check by clicking on the link.
In way to understand non-custodial wallet clearly, there is an example below:
You all have bank accounts, and we do daily transactions through mobile banking, ATMs, and physical visiting in banks. They are responsible for holding our funds, and if they get hacked or any theft in the banking system, they have to pay all the funds back to us according to the rules and regulations.
We deposit money in these systems to secure our money because we know that we will get back our money in any condition. Since banks are a third-party system, they control and manage our money, so they have the right to suspend our account, deny our transactions restrictions, and we need their permission to send and receive funds. But bitcoin’s wallet system is quite different because there are no third parties responsible for managing or controlling your bitcoin, but only you are responsible. You do not need to take the permission of any third party to initiate your transaction.
Benefits of Non-custodial Wallet?
- Complete control on funds:- You can fully manage and control your funds according to your choice because no one can send or receive them except you. Only you have the key of sending and receiving through your wallet, and if someone gets that private key, your wallet may be zero if it has any bitcoin in it.
- No need for permission:- In the case of banking or any third-party service, our funds are under their control, so we have to take the license from them for using our funds, and they can decline anytime if they find any inappropriate activity from our side. But in the case of a non-custodial wallet, you do not need permission from anyone to transfer or request bitcoin from another wallet because you are the owner of your wallet.
- You are the owner:- As we read earlier, you are responsible for storing, transferring and requisitioning, so there is no need for permission of others to do these activities. If you can do all the activities without permission, you are the owner.
- Easy to transfer:- You are the operator of your non-custodial wallet, so the method is straightforward to transfer the bitcoin from one wallet to another. There are no formalities to follow before sending, like filling the paper-like traditional banking transfer.
- Customized Fees setup:- Third-party businesses are always started to earn money for their services, and they have their earning model and set their fees or charges fixed, and no one can alter without their permission. But non-custodial wallet will allow you to customize the costs before sending bitcoin to another wallet, affecting the transferring speed.