Unhosted Wallets

Definition ∞ Unhosted Wallets are cryptocurrency wallets where the user maintains complete and sole control over their private keys. Unlike custodial wallets, no third party holds or manages the user’s digital assets. This type of wallet grants full ownership and responsibility to the individual. It is a fundamental component of financial sovereignty in the digital asset space.
Context ∞ Unhosted wallets are central to the ethos of decentralization and self-custody within the cryptocurrency community. The discussion often revolves around the balance between individual financial autonomy and regulatory concerns regarding anti-money laundering (AML) and counter-terrorist financing (CTF) measures. Future developments will likely involve ongoing debates about potential regulatory oversight, while also seeing advancements in user-friendly interfaces and enhanced security features for these self-managed digital asset storage solutions.