Non-Custodial Swaps

Definition ∞ Non-custodial swaps are direct peer-to-peer exchanges of digital assets that occur without the involvement of a third-party custodian. Participants retain complete control over their funds throughout the transaction, typically facilitated by smart contracts on a blockchain. This method significantly reduces counterparty risk and eliminates the need for trust in an intermediary to hold assets during the exchange. It embodies a core principle of decentralization by empowering users with self-sovereignty over their digital wealth.
Context ∞ The demand for non-custodial swaps continues to grow as users prioritize security and autonomy in the digital asset space. Discussions often address the user experience and the liquidity depth available on decentralized exchange platforms that support these swaps. Future developments will likely include advancements in atomic swap technology and cross-chain compatibility, allowing for seamless and secure asset exchanges across disparate blockchain networks without relinquishing asset control.