The entire cryptocurrency ecosystem has shifted from a niche industry to a mainstream sector wherein people have started executing trades on a large scale. Due to these factors the entire industry has finally reached a meaningful inflection point in the market. However in these markets the most noticeable thing is “digital asset custody.” Although “Custody” is mostly a very broad term which basically focuses on buying and selling cryptocurrency and securing the digital assets.
Self custody mechanism
The cryptocurrency ecosystem has varieties of investors who have various needs in the market. However each type of investor has access to his type of solutions in the over expanding ecosystem.
A basic idea is that a retail investor will always require a relatively simple self custody option while an institutional investor will require an option with heavy customisation. Therefore in order to cater such individuals the market is full of varieties of options such as hardware and software wallets or various offline storages which are third party in nature or maybe cold wallets.
A bunch of users require complete overall custody of their wallet. Therefore they can partake services which allow them complete control over their wallets along with private keys and public keys wherein an unguessable will grant you access to your digital assets. There are various hardware and software wallet options that directly allow you custody of your wallets. However the issue with these wallets is that in case you lose out the key there is no central entity which will help you retrieve these assets for you.
Partial custody mechanism
The partial custody mechanism allows users a partial self control over their assets while there is a third-party that focuses on securing the assets. The core infrastructure focuses on two setup authentication processes paired with a basic multi signature process. In this process the third party focuses on possessing the key required to co-sign the transactions of the customer.
The digital assets custody sector in the cryptocurrency sector is rapidly expanding on a day to day basis providing various innovative solutions in the market which focus on digital assets custody sector.