Lower custodial fees is a significant benefit of Automated Market Makers (AMMs). Here are some ways AMMs can reduce custodial fees:

1. _Decentralized custody_: AMMs can enable decentralized custody, eliminating the need for third-party custodians.

2. _Self-custody_: AMMs can allow traders to hold their own assets, reducing the need for custodial services.

3. _Reduced intermediary fees_: AMMs can reduce the need for intermediaries, resulting in lower fees associated with custodial services.

4. _Increased efficiency_: AMMs can automate many processes, reducing the need for manual intervention and associated fees.

5. _Lower overhead costs_: AMMs can reduce overhead costs associated with custodial services, such as storage and security.

6. _Transparent fees_: AMMs can provide transparent fees, allowing traders to see exactly what they are paying for.

7. _Reduced counterparty risk_: AMMs can reduce counterparty risk, eliminating the need for custodial services to mitigate this risk.

8. _Increased security_: AMMs can provide increased security, reducing the need for custodial services to protect assets.

9. _Decentralized governance_: AMMs can enable decentralized governance, allowing traders to have a say in the management of their assets.

10. _Lower fees for end-users_: AMMs can result in lower fees for end-users, making trading and investing more accessible and affordable.

By reducing the need for custodial services and associated fees, AMMs can create a more efficient, secure, and cost-effective trading environment.