Guide · 4 min read
What a non-custodial swap is, and what it is not
By the AltoSwap team · Reviewed and updated · Editorial policy
Short answerA non-custodial swap service never keeps a balance for you. There is no account to deposit into and nothing to withdraw: you send coins from your own wallet and the result is paid to your own wallet. During the swap itself, for a few minutes, your coins are with the exchange or network that converts them. That exposure is short, but it is not zero.
Custodial and non-custodial, side by side
| Exchange with an account | Instant swap | |
|---|---|---|
| Where your coins sit before and after | In the exchange's wallet, shown as a balance | In your own wallet |
| How long the service holds them | As long as you leave them there | The minutes the swap takes |
| What can be frozen | Your whole balance | At most the one swap in progress |
| Account, password, email | Required | None |
Who holds what on AltoSwap
AltoSwap itself never receives your coins. It finds a route, creates the swap and shows you the deposit address. That address belongs to the exchange or network that carries out the swap, which holds the deposit until it has paid you out.
The risks that remain
- A deposit can be paused by an automated check. How that is handled is what the route's KYC rating describes.
- A swap can fail and be refunded. You get your own coins back, less the network fee, and nothing was converted.
- A mistake in the address or the network is yours to carry. Nobody can reverse a blockchain payment.
What it is not
Non-custodial does not mean that no third party is involved, and it does not make a swap anonymous. The service that converts your coins sees both sides of the swap, and both payments are recorded on their blockchains.
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