What is the difference between a custodial and a non-custodian wallet?

Our guide to custodial vs non-custodial wallets can help. For a custodial wallet, a third party takes custody of the private key instead of the crypto owner. For a non-custodial wallet, the crypto owner holds their own private key and, therefore, their funds.

What is a non-custodial Crypto Wallet?

A non-custodial crypto wallet is a wallet where only the holder possesses and controls the private keys. For users who want full control over their funds, non-custodial wallets are the best option. Since there are no intermediaries, you can trade crypto directly from your wallets.

Does Coinbase have a custodial wallet?

Coinbase offers both custodial and non-custodial wallets to its customers. The exchange's custodial wallet is the wallet that the exchange provides to you automatically when you purchase digital assets via the Coinbase exchange. Coinbase's non-custodial wallet is a browser extension product called Coinbase Wallet.

Are web-based crypto wallets custodial?

Most — but not all — web-based crypto wallets are custodial wallets, and it’s very likely that the first time you purchase crypto, it will end up in a custodial exchange crypto wallet. In this case, the exchange is your custodian, which holds your keys and is tasked with securely storing your funds.