We’ve seen it happen too many times to count now: a centralized bank, exchange or entity goes belly-up, bankrupt and throws in the towel. Everyone who holds their assets on that platform pays the price, losing the hours, blood, sweat and tears they put into their acquisition.
How could this happen? Why do the asset holders pay the price for their custodians’ mistakes? The short answer, if you want it: centralized finance sucks.
What is Self Custody?
In the cryptoverse, self custody means you are the only person that has access to and control over your digital assets and their private keys. Nobody can gain access to your account info or your crypto, not even the platform you use to buy, sell or trade them.
When you choose self custody, you say no to a middleman and take control over your assets and finances, and refuse the counterrisk that comes with using centralized exchanges or custodial wallets.
What Freedom Does Self-Custody Provide?
When you’re the custodian, keeper and ultimate controller of your crypto, you can do whatever you want with it. Mine it, stake it, lend it or just save it. Nobody can tell you when or where you can spend or withdraw your assets, and any interest that comes from lending is all yours.
When your assets are held on a centralized exchange, they run the show. At any given moment, the exchange can freeze your account, refuse withdrawals and trades, or take your crypto straight to bankruptcy court.
Be Your Own Bank
When you have access to decentralized finance through a self-custodial platform like Zelcore, you can be your own bank and safely store your assets with confidence. No financial institutions required.
Say goodbye to the middleman who charges you to hold your money (how did we even let that happen?), and then uses it to fund their own investments or lending programs.
Self custody means you answer to nobody. Especially when you use Zelcore, you can keep your personal information and your holdings completely private. If you’re the type that likes to keep your financial wheelings and dealings to yourself, self-custody lets you keep your transactions, keys and other details to yourself.
More privacy also means more security in self-custody. Your private keys are known only to you, and keeping your keys secure but accessible is easier than you think.
Engrave your keys and phrases on a stainless steel card, so you’ll never lose it even in the event of a fire or water damage. Just be careful — if your keys are lost or destroyed, there’s no way to backup a decentralized hot wallet like Zelcore.
Many critics claim that DeFi is less secure than centralized finance, and that the absence of regulation leaves users unprotected. We beg to differ. The unalterable nature of the blockchain leaves no question or uncertainty where ownership is concerned. Funds can’t simply disappear or be misappropriated in the cryptosphere, the way they can be in TradFi.
Using financial institutions to buy or “own” crypto is like going to McDonald’s for sushi. It doesn’t make sense, and you’ll probably end up regretting it later. When you enter the cryptoverse via centralization, you’re only there with a guest pass.
Traditional finance institutions or centralized exchanges are middlemen. They’re the custodians, the true owners, of all the crypto that comes through their platform. They decide when, where and how your assets are used, withdrawn or lended. And if the company goes up in flames, your coins go with them.
We saw the consequence of this kind of handover when FTX came unbundled, revealing the truth that they’d spread themselves too thin to support user withdrawals. In other words, they spent or invested user assets unwisely, and couldn’t pay everyone back.
Giving up the custody of your assets ultimately means there’s no promise that you’ll ever see them again. Why would anyone willingly do that?
DeFi, and self custody, cuts the middlemen out of the equation and leaves the power — and your assets — in your hands. You can make peer-to-peer transactions to buy, sell or trade whatever assets you want, with more liquidity and freedom.
The Future is DeFi
As the Web3 evolution ushers in a new era of finance, via the blockchain and crypto, we’re on the precipice of financial freedom. While financial institutions and government regulators fight to maintain the power and control they’ve wielded for so long, it’s our duty to relentlessly defend what’s ours and keep third party hands out of our wallets.
For a truly decentralized, self-custody experience in Web3, choose Zelcore to keep your keys, personal information and assets on lock. It’s your crypto, you decide what to do with it.