The Electrum Bitcoin Wallet is a non-custodial digital wallet that uses hot storage, and can combine with the services of a cold storage hardware wallet for extra security. Electrum is one of the oldest Bitcoin wallets, having originated in 2011. This wallet uses two-factor authentication (2FA) to ensure no one else can access your BTC.
Top perks
Straightforward installation
Electrum makes everything easy to download and install, walking you through every step of the process in their installation wizard. This takes all of the complex technological mumbo jumbo and figures it out for you. With Electrum, you don’t have to worry about getting anything wrong during setup. After installation, you can be sure that everything is correct, and get to storing your Bitcoin fast.
Hardware wallet compatibility
By default, Electrum offers hot storage, which is open to invasion from hackers. Electrum also gives users the option to transfer their Bitcoin to a hardware wallet, keeping their coins safe offline. Users can also download the wallet on an offline device to achieve a similar result. Electrum supports many of the most powerful and popular hardware wallets around. It recommends the Ledger Nano series of hardware wallets for storing Bitcoin.
Personalized security
Electrum offers different options for securing the Bitcoins you entrust to them. With Electrum, you can choose whether you want your wallet to be set up with multiple-signature security, 2FA, or standard security for watch-only wallets. These options give you more flexibility in how your Bitcoin is stored.
If you are looking for the highest in security, you might want a multi-signature wallet, which is the most secure of Electrum’s options. Standard wallets have the least security measures. These might be best for users who wish to hold their Bitcoin on an offline device or transfer it to a hardware wallet. For a good middle ground between these two extremes, 2FA is a good choice. This option provides an added layer of security, while still allowing quick access to your funds.
Open-source application
Electrum’s software is publicly accessible, allowing anyone to view and comment on the layout of the application’s code. This means anyone can look over the code to find potential software errors or vulnerabilities. With more eyes on the makeup of the system, potential cracks in the system’s defenses can be spotted before hackers can exploit them. Because of this, Electrum’s design will be consistently updated to ensure evolving security.
What could be improved
Bitcoin only
Aspiring investors may choose another wallet over Electrum due to its sole focus on Bitcoin. Currently, Bitcoin is the only coin supported on Electrum. If you are looking for a place to store all your digital currency, Electrum cannot help with this. Bitcoin is not the only well-known cryptocurrency anymore. An increase in the number of supported currencies would give Electrum the ability to serve a wider variety of crypto traders.
Past security issues
Electrum’s service has experienced some security breaches. Years ago, many users lost the Bitcoin stored on their hot wallets, and Electrum took much heat for it. Today, Electrum offers more robust security measures for their users. Electrum is once again considered a safe place to store Bitcoin. Yet, if a security breach can happen once, it may happen again. Malicious users are always finding new ways to get around successful security measures. Electrum’s past safety failures raise concerns about the future, even with improved security measures in place. This encourages more users to invest in cold storage hardware to hold their coins should they choose to use Electrum.
