In the context of a decentralized wallet, having private keys means that you have full control over the contents of your wallet.
A decentralized wallet may be capable of hodling your crypto funds or holding your digital identity, typically on your own hardware (i.e. no central servers CRUDing your data).
However, many people are not acquainted with digital wallet, blockchain technology, and the concept of public-private keys.
A Custodial Wallet is defined as a wallet in which the private keys are held by a third party. Meaning, the third party has control over the contents of your wallet while you only have to give permission to do CRUD operations on wallet contents. That way you don’t have to worry about losing your private key.
CRUD = Create, Read, Update, Delete, the 4 basic operations required to implement a persistent storage application.
Last Updated: 10 November 2021