How Do Self-Custody Wallets Interact with Token Ownership Standards?

Self-custody wallets (like MetaMask or hardware wallets) hold the user's private keys, which are the cryptographic proof of ownership for the tokens associated with their public address. When a user wants to transfer tokens, the wallet signs the transaction using the private key, proving they are the rightful owner as defined by the token standard.

The wallet simply facilitates the interaction with the smart contract functions.