 If you've been in crypto for the past week, you've probably heard of and seen the collapse of FTX, the second biggest crypto exchange in the market only behind Binance. FTX filed for bankruptcy and is another domino that has fallen during the crypto winter 2022. The cemetery is getting packed with platforms who have filed for bankruptcy or gone broke. And the rumors continue as now we hear whispers about BlockFi, Crypto.com and Genesis, three other huge players in the game. So the question becomes, what can we do to protect ourselves and protect our crypto from going down and losing it completely in one of these platforms? And the answer is not that hard. Self custody wallets. In today's video, we're going to cover exactly what a self custody wallet is and why you need to get one right now. We will also break down the difference between the different wallet types and some of the ones that I personally use. So let's go ahead and dive right in to today's video. What's up guys? I'm Jay and welcome to Bitcoin Daily. Remember that this content is for educational purposes only and is not financial advice. Always do your own research before risking any of your own money. And as a disclaimer, I am invested in Bitcoin since 2016. So if you guys are new here, don't forget to subscribe to the channel, smash the like button and turn on the notification bell, or you might miss out on some of these keys to success in the crypto markets. So first off, we need to understand what a custodial wallet is. Simply put custodial wallets give control of your keys to a third party. So when you put your funds in a centralized exchange like FTX, BlockFi, Gemini, Coinbase, Celsius, Voyager, and we could just continue going down the list, you're trusting a third party to control, manage and basically do whatever they want with your funds with your crypto securely and for them to give you access to your own crypto when you need to trade them, when you need to move them or do anything else with your crypto. This is basically the same as keeping your money with a bank while that may be easy to use. And it may be convenient for you to do it that way. Keeping someone else with the security of your funds well, it never ends well. And it's something that we actually have learned many times over with banks. And it's also a reason why Bitcoin was created so that we, the people have control of our own funds and we don't trust a third party, a government, a centralized bank to give us the permissions on what to do, how to move our money, when to move our money and all of that. So then the question becomes, well, then what's the best way for me to store my crypto and that my friends is called self custody wallet or also known as a non custodial wallet. So what is a self custody wallet? So a self custody wallet allows you to own and control the private keys to your crypto. This way the wallet provider cannot freeze or manage your assets in any way, which is what we have seen over and over and over again as these platforms have fallen. They've been taking your funds, using them for high risk investments, high risk trades, they're using as venture capital or whatever they see fit. And then when they make a couple of bad moves, Bitcoin's value drops, they owe a bunch of money. Now they could no longer pay you back when you want to pull your funds out and you just lost all your crypto and you're probably never going to get it back. So the underlying principle is that with a self custody wallet, you control the keys to your crypto, you control your crypto. So why use a self custody wallet? I mean, I think we've answered it already, but let's answer this question. And I think if we just look at what's happened in the past week, it answers it for us. FTX was the second largest exchange only behind Binance. So of course, people trusted their funds with this exchange. The issue is, if you had your funds in this exchange, you didn't have control of your funds. So FTX actually had control of your funds and were able to manage your funds, however they saw fit. So FTX controlled all users crypto, FTX used users funds for high risk investments, trading and other things. FTX lost user funds and filed for bankruptcy. Since users did not own the keys to their wallets on FTX, they probably will never see that crypto again. And that pretty much answers why you should use a self custody wallet at all times from here on going forward. And this is a tell as old as time. This happened way back in the day when there was a exchange called Mt. Gox that basically used the user's funds and got hacked or whatever the case was and lost all the funds for the users. The users 10 years later are still trying to get their funds out. That's why I say if you're stuck on one of these platforms, they're probably never going to get those funds back. And we've seen it with Mt. Gox, we've seen it with Luna, UST, with Celsius Network, Voyager, Digital, FTX, FTX US. Now we're seeing it possibly with BlockFi, possibly even with Gemini. All of these platforms have complete control of your crypto. If you have your crypto in any of these platforms, what you need to know here is if you do not have the keys to the wallet, then you do not own that crypto. The third party owns your crypto. Apart from that, some other things that happen when you have your funds in a centralized CFI platform is that they have withdrawal limits, they have fees. Maybe you don't see the exact fees. Maybe they just include the fees in by changing the price of the crypto token that you're moving out or trading or whatever the case. Self-custody removes all of that and gives you 100% control of your funds. With a self-custody wallet, you alone are responsible for the safety of your keys and your crypto. Because once again, remember, not your keys, not your crypto. All right. So hopefully by now I've convinced you to take your money and remove it from all these CFI platforms and get yourself a self-custody wallet. Let's talk about what's the difference between a hardware and software self-custody wallet. But before we do that, make sure that you guys smash that like button if you're enjoying this video and subscribe to the channel. So hardware wallets are also known as cold wallets. And what a cold wallet means is that it's not stored online. It's stored in a USB-like device offline. And the reason for this is pretty simple is that you won't get hacked. Software wallets, on the other hand, are basically an application either on your PC or on your mobile device. These are encrypted. They securely store your private keys and provide an interface for you to trade and manage your crypto. Software wallets are encrypted and require a password for you to access your private keys and your crypto. So which one should you use? Well, honestly, it depends on you. Cold wallets are obviously going to always be a lot safer. And if you have large amounts of money, then I definitely recommend investing in a cold wallet and keeping your crypto offline. If you don't have that much funds invested in crypto, then it's fine for you to use one of the applications, especially if you're going to be moving in and out of positions and trading and you need to move them constantly, for example. I think the best mix overall that I use personally is a mix of both. I think you should have the majority of your long-term portfolio offline on a cold wallet and then anything you use for trading, for example, you can keep in a software self custody wallet. But again, everyone's situation is different. So that's really going to be for you to decide which one is best. So next I'm going to give you guys a couple different hardware wallets and software wallets that you guys can use. And I definitely recommend for you guys to do your own research and see which one is the best one for you. So as far as the best self custody hardware wallets, I always recommend either ledger or treasure. These are probably the two biggest and most popular ones out there that the majority of people that I know use. I personally, myself, use ledger. So for software wallets, many people might not know this, but you may already be using a software self custody wallet if you're using MetaMask or if you have any funds on MetaMask. Now MetaMask is built on the Ethereum network, so you wouldn't be able to hold Bitcoin or anything like that. So another wallet that I personally use is Trust Wallet. You could actually download this on your phone. I have this on my iPhone and you can store a lot of different cryptos in there as well. The bottom line is take your funds out of centralized platforms, centralized finance, centralized exchanges. Do not give your funds to a third party for them to manage it or have complete access to them. Because when something like this happens, as you guys can see with FTX, even though they were the second biggest platform in the market, it still fell. So that shows you that no matter how big these companies are, they can still fall, you can still lose your crypto in them. The safest route to go so that you don't ever have to worry and so you can sleep good at night is to have a self custody wallet, like one of the ones that I mentioned in today's video. You need complete control of your keys because not your keys, not your crypto. Let me know if you guys have any questions about anything that we covered in today's video. Let me know which self custody wallet you might prefer and which ones you might have had the best experience with. As you guys know, the goal of this channel is to provide as much education and information for free for everyone. If you guys enjoyed this video, make sure to smash that like button and subscribe to the channel. I know with the value of Bitcoin dropping, a lot of people are probably losing money. But did you know that you can actually make profits as the value of Bitcoin goes down? I recently did this video on how to short Bitcoin where I showed you guys exactly how you can bet on its value dropping to make some profits during these crypto winters and bear markets. Just make sure to click the video that's on the screen right now. You guys don't want to miss it. I'll see you guys on the next one. As always, peace and love.