Scenario: You are a customer of a bank or financial institution. The bank stores records of your transactions and account balances, which you access through your online banking portal.

Self-Custody is Control: Your financial history is controlled by the bank, which records and manages your transaction data. The bank has authority over this information, meaning they can restrict your access or share the data with third parties if required by law. You are responsible for monitoring your financial history and ensuring your account is used appropriately, while the bank is responsible for maintaining accurate records and complying with privacy and regulatory obligations. Enforcement comes from the bank’s systems, which can limit your access to financial history or block certain actions based on regulatory compliance or security concerns.

Self-Custody is a Spectrum: The parties are you, the user, and the bank. The bank has an unfair advantage because they manage the infrastructure where your financial history is stored. You rely entirely on them for access to your records, which means if they choose to block or lose access, you cannot retrieve this information independently. This imbalance places you low on the self-custody spectrum.

Self-Custody is Recursive: Your financial history, including bank statements and credit reports, is crucial for securing loans, mortgages, and lines of credit. The unfair advantage banks and credit agencies have is their control over your financial data, deciding how and when it’s shared with third parties. If your financial history is compromised you could lose the ability to secure dependent constructs such as loans to buy real estate, finance a vehicle, or even start a business. The cascading effect of compromised financial history impacts your creditworthiness, making it difficult or impossible to make major life decisions or purchases, while others may profit from your stolen identity.