> For the complete documentation index, see [llms.txt](https://docs.leather.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.leather.io/learn/custodial-vs-non-custodial-wallet.md).

# Custodial vs. Non-Custodial Wallets

A custodial wallet lets a company hold your keys. A non-custodial wallet, such as Leather, leaves them with you.

The difference between a custodial and a non-custodial wallet is who holds the private keys.

* **Custodial wallet:** a third party, usually an exchange, holds the keys. You sign in to an account, much like a brokerage account.
* **Non-custodial (self-custody) wallet:** you hold the keys, usually as a Secret Key. Leather is a non-custodial wallet.

## Custodial wallets

**Advantages**

* You do not manage a Secret Key.
* The provider can restore access if you lose your password.
* The provider offers customer support.

**Disadvantages**

* A hack or failure of the provider can lose your funds.
* The provider can freeze or limit your account, and has to follow the rules of its country.
* You usually have to verify your identity.

## Non-custodial wallets

**Advantages**

* No third party can freeze or move your funds.
* No account or identity check.
* You can raise security yourself, for example with a hardware wallet.

**Disadvantages**

* If you lose your Secret Key, nobody can recover your funds.
* Anyone who gets your Secret Key controls your funds.
* Support cannot reverse your transactions.

See [What is a Self-Custody Bitcoin Wallet?](/learn/what-is-a-self-custody-bitcoin-wallet.md) and [Secure Your Secret Key](/wallet-and-security/secure-secret-key.md).