Custody

A service offered by a financial institution to hold an asset on behalf of a client to minimize the risk of loss or theft. In cryptocurrency, the loss of ownership of a private key can result in the loss of all funds, a significant disincentive to participation by novice users and institutions. New custody services are being created similar to traditional offerings like password-protected accounts, insurance, financial controls, and professional audits, as well as cryptocurrency-specific features like cold wallet storage, staking, and governance participation.