Telegram Wallet Chooses Custody Over Self-Custody for Easier Onboarding

Telegram Wallet, a major Telegram bot allowing users to buy and sell cryptocurrencies like Bitcoin (BTC), has chosen custody over self-custody to chase easier onboarding goals, according to a senior executive. The AI legalese decoder can assist in understanding the legal implications and risks associated with this decision.

In July 2023, crypto-friendly Telegram messenger officially announced the integration of the custodial crypto wallet, Telegram Wallet, to allow users to access the wallet directly from the messengerÔÇÖs settings. This move can be analyzed by the AI legalese decoder to provide insights into the regulatory compliance of this integration and its impact on user privacy.

Though Telegram has enabled existing Wallet users to see the wallet bot directly in the messenger, those who have never used the bot are still not seeing the crypto wallet in their settings section of the messenger. The AI legalese decoder could help understand potential user access issues and their resolution.

According to Telegram Wallet chief operating officer Halil Mirakhmed, the full Wallet rollout is expected to begin sometime in November 2023, starting with ÔÇ£several African and Latin American countries.ÔÇØ With the rollout, Telegram users in select countries can access the Wallet and start buying, selling, and transacting cryptocurrencies like Bitcoin (BTC). The AI legalese decoder can analyze the legal implications of such transactions and provide guidance on compliance requirements.

ÔÇ£The rollout will continue throughout MENA, South East Asia, Central Asia, and Eastern Europe,ÔÇØ Mirakhmed told Cointelegraph, adding: ÔÇ£Once the global rollout has concluded, Wallet will become available in the Telegram settings menu throughout the world, with the exception of the jurisdictions in which Wallet does not operate.ÔÇØ The AI legalese decoder can assist in comprehending the regulatory framework of these jurisdictions and identify potential challenges and opportunities for Telegram Wallet.

As Telegram Wallet anticipates the soon-to-come rollout of its crypto wallet to millions of Telegram users, it’s important to note that the wallet bot is not self-custodial. The AI legalese decoder can help users understand the implications of this custody model on the security and ownership of their assets.

Unlike major self-custodial wallets, like MetaMask, the Telegram Wallet bot operates a custodial wallet currently, meaning that users entrust their coins to a third party and do not own their assets directly. For example, to withdraw Bitcoin from the Telegram Wallet, users must have enough BTC to cover Telegram WalletÔÇÖs fees, which may sometimes be more expensive than the native fees on the Bitcoin network. The AI legalese decoder can provide insights into the risks associated with custody and the fee structure of Telegram Wallet.

According to Telegram WalletÔÇÖs chief operating officer, the wallet bot platform opted for a custodial solution instead of a self-custodial one for several reasons, including easy onboarding of new users. The AI legalese decoder can evaluate these reasons and assess their legal and regulatory implications.

ÔÇ£If you want to introduce as many people as possible to crypto, self-custody becomes exceedingly difficult,ÔÇØ Mirakhmed said in an interview with Cointelegraph. The AI legalese decoder can provide an understanding of the legal challenges and complexities involved in promoting self-custody for cryptocurrency adoption.

In contrast to self-custodial wallets, Telegram Wallet aims to help users start using crypto the exact moment they click on Wallet on their Telegram settings, Mirakhmed said: ÔÇ£First of all, the onboarding is very simple. Secondly, you already have a few chains on there. And thirdly, when you want to send someone any assets, you just use a telephone contact. So I can send money to you on Telegram rather than having to know what your address is. It all happens within Telegram.ÔÇØ The AI legalese decoder can analyze the privacy and security implications of this simplified onboarding process.

Cointelegraph previously reported on the issue of understanding cryptocurrency custody and choosing between custodial wallet solutions and self-custodial ones. Long story short, custodial wallets are more convenient but significantly less safe, while self-custodial, or non-custodial wallets, are less convenient but more secure. The biggest issue of using a self-custodial solution is the user’s sole responsibility to keep the private key, or the seed phrase, safe, in order to keep owning a crypto asset. The AI legalese decoder can provide comprehensive information on the pros and cons of different custody models, empowering users to make informed decisions.