Self-Custody Explained: Why Pera Never Holds Your Keys

Updated October 28, 2026

What Does “Self-Custody” Mean?

Self-custody means you — and only you — hold the private keys that control your assets. No company, no bank, and no third party can access, freeze, or move your funds without your permission.

When you use Pera Wallet, your private keys are generated and stored on your device. Pera’s servers never see them. This is fundamentally different from keeping assets on an exchange or in a traditional bank account, where the institution holds custody on your behalf.

The simple version: If you hold the keys, you own the assets. If someone else holds the keys, you’re trusting them to give you access.

How Pera’s Self-Custody Works

Your keys stay on your device

When you create an account in Pera Wallet, a cryptographic key pair is generated locally on your phone or computer. The private key — the one that authorizes transactions — is encrypted and stored on your device. It’s never transmitted to Pera’s servers or anywhere else, with one opt-in exception: if you turn on Cloud Backup, your keys are end-to-end encrypted on your device before upload, and Pera can’t read them.

Your recovery passphrase is your backup

During account creation, Pera generates a 24-word (Universal Wallet) or 25-word (Legacy Algo25 or Quantum account) recovery passphrase. This is the human-readable version of your private key. It’s the main way to restore access to your account if you lose your device, alongside the optional Cloud Backup.

Pera never sees your passphrase. If you lose it, nobody — not Pera, not Algorand, not anyone — can recover your account. This is the tradeoff of self-custody: full control also means full responsibility.

For detailed backup instructions, see Backing up your Recovery Passphrase.

Transactions require your approval

Every transaction — sending, swapping, staking, connecting to a dApp — requires you to sign it with your private key. Pera Wallet handles this signing process locally on your device. You confirm with your PIN, biometrics, or passkey, and the signed transaction is submitted to the Algorand blockchain.

No one can initiate a transaction from your account without your explicit approval.

Self-Custody vs. Custodial Services

	Self-Custody (Pera)	Custodial (Exchange or Bank)
Who holds the keys?	You	The company
Can they freeze your funds?	No	Yes
Available 24/7?	Yes — blockchain never closes	Subject to business hours, maintenance, outages
Risk if company fails?	None — your keys, your assets	You may lose access (see: FTX, Celsius, SVB)
Recovery if you lose access?	Recovery passphrase, or Cloud Backup (Passphrase plus Encryption Key)	Customer support, ID verification
Privacy	No personal data required for basic use	KYC/AML identity verification required

Why Self-Custody Matters

You’re not dependent on anyone else’s solvency

When an exchange or custodian holds your assets, your funds are only as safe as that company. If they get hacked, go bankrupt, or freeze withdrawals, you’re stuck in line with every other creditor. With self-custody, there’s no counterparty risk — your assets live on the blockchain, accessible only to whoever holds the keys.

You have 24/7 access

Traditional banks close on weekends. Exchanges go down for maintenance. Wire transfers take 3–5 business days. With Pera, you can send, receive, and manage your assets at any time — the Algorand blockchain processes transactions in seconds, 24 hours a day, 365 days a year.

Your data stays yours

Pera Wallet doesn’t require an email address, username, phone number, or identity verification to create an account and use basic features. Your financial activity isn’t tied to a profile that can be sold, breached, or surveilled.

The Responsibility That Comes With It

Self-custody isn’t just a perk — it’s a commitment. Here’s what it means in practice:

Back up your recovery passphrase immediately. Do this during account creation. Store it offline in a secure location. See our backup guide for best practices.

Never share your passphrase with anyone. Pera will never ask for it. No legitimate service will. Anyone who asks is trying to steal your assets.

Protect your device. Enable your phone’s screen lock, use biometric authentication in Pera, and keep your app updated.

Understand that transactions are final. There’s no “undo” button on the blockchain. Double-check addresses and amounts before confirming.

Security Features in Pera

Pera is built to make self-custody as secure and frictionless as possible:

Passkeys: Passwordless authentication using biometrics or hardware keys. Liquid Auth support is coming soon. See our Passkeys guide to set them up.
Cloud Backup: An optional, end-to-end encrypted backup that Pera can’t read, restored with a 12-word Passphrase plus an Encryption Key. See Cloud Backups.
Quantum Accounts: Accounts secured with a post-quantum key and their own 25-word passphrase. See Quantum Accounts.
Rekeying: Assign a new private key to your account without moving your assets — useful if you suspect your keys may be compromised. See How to Rekey.
Ledger support: Connect a hardware wallet for an extra layer of security. Your keys live on the Ledger device, isolated from your phone or computer.
Open source: Pera’s code is publicly available on GitHub so anyone can verify how it works.

Need more help? Visit perawallet.app/contact-us.