Definition ∞ Self-custody is the practice of an individual or entity directly controlling and managing their own private keys for digital assets, rather than entrusting them to a third party. This grants the holder full autonomy over their funds, eliminating counterparty risk associated with custodians like exchanges or centralized wallets. It is a foundational principle of cryptocurrency ownership.
Context ∞ The current discourse on self-custody frequently highlights the security responsibilities it entails, including the risks of private key loss or theft. Discussions often revolve around the user experience of managing private keys and the development of more accessible yet secure hardware and software solutions. A critical future development to monitor is the impact of regulatory efforts on the accessibility and perceived risks of self-custody for mainstream users.
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