NFTs, DAOs & Web3

What is a Web3 wallet and how does it differ from an exchange account?

A Web3 wallet is software where you hold the private keys to your own crypto assets directly, while an exchange account holds your assets on a company's platform under its custody. With a self-custodial Web3 wallet you control the keys and can interact with decentralized apps, but you alone bear responsibility for backing up your recovery phrase; on an exchange the platform manages keys and access for you. For example, losing an exchange password is recoverable through support, but losing a wallet's recovery phrase can mean losing the assets permanently. Each model trades control against convenience.