Definition
Custodial vs. Non-Custodial
Whether a third party (custodial) or you alone (non-custodial) holds the keys or account controls to your money or assets.
A custodial account or wallet means a company holds your assets on your behalf and can freeze or restrict them independent of your wishes. A non-custodial setup gives you direct control, with the trade-off that recovery options depend entirely on your own backups.
Why it matters: the choice is a direct trade between convenience and independence. Understanding which one you are using for any given account is a prerequisite to assessing your actual risk.
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