Non-custodial refers to a design where a platform never takes custody of user funds. Users interact directly with on-chain smart contracts — the platform facilitates the transaction but never holds, controls, or has access to the tokens.

In a non-custodial system, users retain full control of their assets at all times. There is no central party that can freeze funds, run away with deposits, or be hacked to expose user assets. The smart contract rules determine all token movements.

Non-custodial is the standard design for trustworthy DeFi platforms. It contrasts with custodial platforms — such as centralised exchanges — where the platform holds user funds on their behalf.