Definition ∞ Self-custody assets are digital currencies or tokens directly controlled by their owner, not a third party. This refers to digital assets where the individual holder possesses direct control over their private cryptographic keys, thereby maintaining sole authority over their funds. Unlike assets held on centralized exchanges, self-custody removes reliance on intermediaries, granting users complete autonomy and mitigating counterparty risk. This approach necessitates robust personal security practices to prevent loss or theft of the private keys.
Context ∞ The discussion around self-custody assets highlights the core principle of decentralization in the crypto space, emphasizing individual sovereignty over financial holdings. A key debate involves balancing the benefits of absolute control with the personal responsibility required for secure key management, as loss of keys means irreversible loss of assets. Future developments will likely focus on improving user-friendly self-custody solutions, enhancing educational resources for secure practices, and integrating these solutions more seamlessly with decentralized applications.
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