Custodial vs Non Custodial Wallet
The difference is who controls the private key. In custodial walletsIn custodial wallets the private key is held a third party (... More the private key is held a third party (i.e. an exchangeA business that allows customers to trade cryptocurrencies o... More), while in non-custodial walletsIn a non-custodial wallets the private key is held by the ow... More the private key is held by the owner of the walletA device, physical medium, program or service whose sole pur... More. Whoever controls the private key, also controls the funds. Losing the private key, usually leads to losing the funds.