What is self-custody, how does it work and why you should use Bifrost Wallet to be your own custodian.
Bifrost Wallet is a self-custody (non-custodial) crypto wallet, but what does that mean?
Self-custody basics
The basis of a cryptocurrency wallet are public and private keys. The public key allows anyone to send transactions to your wallet and is, as you might guess, something that you can share with whoever you desire. Keep in mind that if someone has access to your public key, that information can be used to inspect all transactions to and from your wallet.
While anyone can send transactions to you using your public key, only you can make transactions from your wallet with the help of your private key. The private key can either be managed by you (self-custody) or by someone else (custodial).
In a custodial service, i.e. a managed wallet or on a crypto exchange, the private key is managed by the service provider, a custodian. This means that if the custodian is hacked or in any way compromised, your assets might get stolen.
The custodian could also misuse the assets you store with them, for example, consider the recent scandal with FTX. That is not the first or last time a custodian behaves irresponsibly with their users' assets. By storing assets with a custodian, you trust that they safe-guard the private key and keep your assets safe.
Our promise
It is our stance that unless you own the keys, it is not really your crypto. The crypto you store with a custodian should be your crypto, and in most cases it is, but there are no guarantees. We believe that users should own their crypto and in this case, their wallet.
If you use Bifrost Wallet, no one has access to your private key except for you. The private key is represented by a recovery phrase, which is a sequence of words that can be used to restore your wallet in case your device is lost/broken or if you upgrade to a new device.
Bifrost Wallet will never store any data about your wallet. All data is stored on your device.
We do not assign any email or other identifiable information with your addresses.
We cannot access your wallet from a backend. This has two main implications, we cannot access your funds, and we cannot help you recover your wallet if the recovery phrase is lost.
You can always use your recovery phrase to migrate to another wallet application if you would not be satisfied with Bifrost Wallet, we go out of business or encounter technical issues.
Keep the following in mind;
If your recovery phrased is shared with someone who should not have access to it, transfer your funds to a new wallet immediately.
If you store large assets, consider doing so on a cold wallet or a multi-signature wallet as this is considered safer than keeping it on just one device with internet access.
Backing up your wallet
When using a self-custody wallet, keeping your recovery phrase is very important as it's the only way to restore your wallet. Here are a few tips to ensure future access to the wallet.
First, do not share the seed phrase with anyone. If someone asks for your seed phrase, it’s most likely a scam. If you share the seed phrase with someone, that person can restore your wallet on any device and perform any transaction with your assets.
Second, make backups of the seed phrase. The seed phrase should not be stored digitally, i.e. avoid photos, cloud based notes or password managers. All digital devices connected to the internet can be compromised. Instead, store it physically, for example on a handwritten paper note inside a safe.
For redundancy, make sure to create multiple backups and preferably store them at different physical locations, there is always a risk of misplacing it or for the physical location to be damaged by a fire/flood/hurricane.
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