Best Bitcoin Wallets Review: 2024 What to Know

Alright, so you’ve acquired some Bitcoin. Now, what’s the best way to store it safely in 2024?

TL; DR: Not your keys. Not your coins. If you leave Bitcoin on an exchange, it’s legally not your Bitcoin.

At any time, the exchange can freeze your account, disable withdrawal ability, or take several actions that mean you can’t get access to your Bitcoin, like what we recently saw with FTX, Genesis, GBTC, BlockFi, and other third-party wallet services.

We are here to help take you through the process of finding the right Bitcoin wallet for you. Although it seems like a straight­for­ward question, there is a surprising amount of nuance to consider. 

• How much Bitcoin do you have?

• How often do you plan to spend it?

• Are you confi­dent your keys are more secure with you than with a regulated custo­di­an’s cold storage? 

Let’s get into it!

Bitcoin is a bearer asset, meaning you can hold the keys to your Bitcoin yourself. When you maintain your own Bitcoin keys, you are in direct control of your money. It is not entrusted to any third party, like a bank.

In cryptog­raphy, a public key is used to encrypt messages, and a private key is used to decrypt them. If someone wanted to send you an encrypted message, they would encrypt it with your public key.

Your private key is the only way to decrypt that message, so as long as you are the only person who holds the private key, you are the only person who can read the message.

Bitcoin uses public/private key cryptog­raphy to secure trans­ac­tions. A private key is created when you make a Bitcoin wallet. The wallet creates public keys that are hashed and used as addresses for receiving Bitcoin.

The private key is required to prove the owner­ship of the Bitcoin stored at that address so it can be spent. 

If you person­ally don’t control the private keys associ­ated with your Bitcoin, then you don’t actually hold your own Bitcoin. In other words, if an exchange or a bank is holding your Bitcoin on your behalf, you are not in direct control of your Bitcoin. You are outsourcing the security of your Bitcoin to another party.

You should hold your own keys once you deter­mine that the risk of holding your keys person­ally is lower than the risk of a custo­dian losing them. Making this decision relies primarily on your under­standing and comfort level of how and why to hold your own Bitcoin keys.

It’s empow­ering to be able to hold your Bitcoin in your custody so that it cannot be seized or confis­cated by banks or the hackers that target them. Our goal is to help you become comfort­able with the prospect of holding your own keys.

Until then, the Bitcoin in your Swan wallet is held by our U.S. custodial legal trust banking partners in an account in your name as the beneficial owner under state-of-the-art security practices.

Now, let’s look at your options for taking control of your own Bitcoin keys.

The main tradeoff to consider when storing your Bitcoin is between security and conve­nience.

Obviously, both security and conve­nience are desir­able traits when storing your Bitcoin; however, they are directly opposed to each other.

Where do you sit on the security vs. conve­nience spectrum?

Ask yourself these questions to gain a better feel for what storage method makes the most sense for you:

• Total Value — Are you storing on the order of 0.1%, 1%, or +10% of your net worth in Bitcoin?

The answer would neces­si­tate very different methods of storing your Bitcoin. Obviously, you would be willing to suffer more incon­ve­nience if it meant protecting 50% of your net worth. 

• Timeframe/Acces­si­bility — When and how often do you need to spend your Bitcoin?

Is this more of a checking account, a medium-term savings account, or is your Bitcoin more similar to a long-term retire­ment account?

Pro Tip: Don’t make your custody setup so compli­cated that even you forget how to access the funds. Bitcoiners tell cautionary tales of people losing Bitcoin due to overcom­pli­cated custody setups resulting in the owner forget­ting how to access their coins.

Now that you’ve decided to acquire some Bitcoin (smart move), it’s time to choose where to store your Bitcoin. This can feel overwhelming when you’re getting started.

What: Users store private keys on a mobile device. 

Pros: Simple to use, suitable for begin­ners, works for small amounts, conve­nient for spending even though most people rarely spend their Bitcoin right now (too much upside to holding for the long term!) 

Cons: Least secure option as private keys are on a device connected to the internet. If an attacker gains physical access to your phone, funds can be sent to their own wallets. Not suitable for long-term storage. 

Example: Muun

What: Users store private keys on their desktop computer.

Pros: Good UX, conve­nient for spending. Most desktop Bitcoin wallets allow users to connect to signing devices for enhanced security. 

Cons: Not very secure as computers are connected to the internet and vulner­able to attacks. Not suitable for long-term storage. 

Examples: Bitcoin Core and Electrum (advanced), Specter (inter­me­diate), Block­stream Green (beginner).

What: Users store private keys on a purpose-built piece of hardware called a signing device. These devices can connect with Bitcoin software running on desktop and mobile devices. 

Pros: Private keys never touch the internet, which reduces the risk of online attacks. Suitable for long-term storage. Since most signing devices require a PIN to access, if you lose your signing device, you can use the recovery phrase to regain access to your Bitcoin. 

Cons: Users must secure a recovery phrase which serves as a backup to their hardware, and requires a thoughtful strategy to protect. 

• If your hardware wallet is stolen, your funds are at risk of being hacked.

• Protecting recovery phrase backups is standard practice for self custody of Bitcoin. 

Examples: Blockstream Jade, and Coldcard.

What: A paper Bitcoin wallet is a way to store Bitcoin private keys offline. It typically involves printing out your Bitcoin public and private keys on paper oftentimes encoded as a QR code.

Pros: If properly generated are immune to online hacking risks. 

Cons: Vulnerable to physical damage and degradation, inconvenient for frequent use, and pose a high risk of irreversible loss if lost or stolen. Carry a risk of key interception during printing if the printer is not secure.

What: User stores private keys in a unique wallet that requires multiple private keys to sign before your funds can be moved. A “2‑of‑3” multi-sig wallet, a user needs two out of three private keys to move funds.

Pros: One of the most secure ways to store your Bitcoin, reduces the effec­tive­ness of physical attacks and is suitable for long-term storage. 

Cons: Hard to set up on and manage on your own, but several services exist to make it easier. Not conve­nient for spending, but that’s the point.

Examples: Swan Vault, Unchained Capital’s Vault (2‑of‑3), Specter (DIY), Electrum (DIY).

Guy Swann hosts "Zero to Multi-Sig" with BTC Sessions, Seth for Privacy, Trey Sellers. We discuss the best way to learn about self-custody, multi-sig benefits, and how to safely store your Bitcoin.

Understanding the differences between hot and cold Bitcoin wallets is crucial for managing your cryptocurrency securely.

Hot Wallets

• Internet Connection: Hot wallets are connected to the internet, making them easy to access for daily transactions.

• Security Risks: Their constant internet connection makes them more vulnerable to hackers. It’s recommended that they store only small amounts of Bitcoin in hot wallets.

• Use Case: Ideal for frequent transactions, similar to carrying a physical wallet for daily spending.

Cold Wallets

• Offline Storage: Cold wallets are not connected to the internet, greatly enhancing their security against online threats.

• Accessibility: Less convenient for frequent use due to their offline nature, but significantly safer.

• Recommended Use: Best for long-term storage of Bitcoin, acting like a safe for your digital assets.

Bitcoin Wallet Backup Seeds

• Backup Necessity: Most wallets prompt users to write down a backup seed phrase, which is a crucial recovery tool if they lose access to their wallet.

• Security Importance: These backup seeds must be guarded as meticulously as valuable physical assets since they contain all the necessary information to access your Bitcoin.

Seedless Bitcoin Wallets

• Multi-signature Support: Seedless wallets are typically used in multi-signature setups where no single backup seed is generated.

• Backup Handling: Instead of user-managed seeds, these wallets often rely on a service to handle backups securely.

Bitcoin Multi-sig: How it Works

• Multi-key Security: Multi-sig wallets enhance security by requiring multiple signatures for transactions. For example, in a 2-of-3 setup:

  • Key Distribution: You would have three private keys but need at least two to authorize a transaction.

  • Risk Minimization: Keys are often kept in physically separate locations to mitigate the risk of theft or loss.

***Just don’t get too creative, or you might fool yourself and lose your funds (it’s happened many times). 

As mentioned above, here are a few examples of multi-sig­na­ture wallets:

• Swan Vault (2-of-3)

• Block­steam Green Wallet (2‑of‑2)

• Casa’s Keymaster (2‑of‑3 and 3‑of‑5)

• Unchained Capital’s Vault (2‑of‑3)

• Specter (Design your own setup)

Multi-signature (multi-sig) technology adds an extra layer of security and flexibility to the management of your Bitcoin. Here are the key advantages:

• Error Tolerance: Multi-sig configurations, such as a 2-of-3 setup, allow room for error. If you lose one private key, you can still access your funds with the remaining keys. This significantly reduces the risk of total loss compared to a single-key setup.

• Mitigation of Physical Attacks: Multi-sig can protect against physical threats to your Bitcoin. In a scenario where you might be coerced into transferring your Bitcoin, having a multi-sig setup complicates this process.

• Geographic Separation of Keys: By distributing your keys across different locations (e.g., your home, office, and a safety deposit box), you decrease the likelihood of a successful physical attack. This geographic spread of keys deters attackers by making accessing all keys needed to transfer the Bitcoin significantly more challenging.

• Enhanced Security: The need for multiple keys to authorize a transaction adds a layer of security that is absent in standard single-key wallets. This setup ensures that no single person or compromised location can control the entire wallet.

Why Does My Bitcoin Wallet Address Keep Changing?

Understanding why your Bitcoin wallet address changes frequently can be complex, but it’s an essential feature designed to enhance your security and privacy. Here’s a simple breakdown:

• Multiple Public Addresses: Each set of private keys in your wallet can generate billions of public keys. These public keys are transformed through a process called hashing to create public addresses.

• Receiving Bitcoin: You can receive Bitcoin at any of these public addresses. The capability to create numerous addresses from a single set of private keys ensures that you have many addresses under your control.

• Spending Bitcoin: While anyone can send Bitcoin to these addresses, only the person holding the corresponding private keys can spend the Bitcoin from them.

• Think 'Email': Think of Bitcoin wallet keys like email services. Your private keys are akin to your email password, public addresses to your email address, and the wallet itself is similar to your email client (e.g., Gmail, ProtonMail). However, unlike email, each private key can access billions of potential public addresses.

• Privacy Protection: Generating new addresses for transactions helps protect your privacy. This feature prevents others from tracking your financial activities on the public Bitcoin blockchain.

• Security of Funds: As long as you control the private keys, you maintain access to Bitcoin sent to any address generated by your wallet.

• Safety Tips: It’s crucial to keep your private keys secure and private to protect your Bitcoin.

The easiest way to approach Bitcoin custody is to focus on “How much money is at stake?”

In other words, what percentage of your net worth is being secured. We understand each person’s situa­tion is unique. Below are our recommendations.

Use this as a guide­line rather than absolute truth.

• Muun — It’s probably the easiest Bitcoin wallet for iPhone and Android. Muun is a hybrid Bitcoin and Lightning Network wallet known for its simplicity, security, and seamless handling of both on-chain and off-chain transactions.

  • It features an intuitive design and robust security measures, including an encrypted "Emergency Kit" for fund recovery. It uses "Submarine Swaps" for easy transfers between networks.

  • Muun simplifies the user experience by eliminating the need for manual channel management and is partially open-source for increased transparency. It’s designed for users at all levels.

• Phoenix — A user-friendly Bitcoin wallet focusing on the Lightning Network for quick, low-cost transactions. It’s non-custodial, offering full control over funds, automates technical tasks for ease of use, and features robust security measures.

  • It automates complex processes like channel management, making it accessible to newcomers while ensuring users retain full control over their funds through private keys.

  • Phoenix also features security measures like PIN and biometric authentication, supports easy backup and restoration, and is open source for transparency and community review.

• Blockstream Jade — A secure and affordable hardware wallet designed for Bitcoin and Liquid Network assets.

  • The wallet supports USB and Bluetooth connectivity, is compatible with the Blockstream Green software wallet, and features open-source firmware for enhanced security through community review.

  • Jade is user-friendly, with a clear display and physical confirmation button, and supports multi-sig transactions for added security.

• Passport — A hardware wallet focused on high security, ease of use, and durability.

  • It stores private keys offline, utilizes open-source firmware for community-driven security enhancements, and supports air-gapped operations via QR codes, eliminating the need for physical connections.

  • Passport features a user-friendly interface designed to resemble a passport for ease of carrying and durability.

  • It supports multi-signature transactions for added security layers and is compatible with various Bitcoin wallet software.

• SeedSigner — A DIY, open-source Bitcoin hardware wallet that allows users to assemble their device from widely available components, such as a Raspberry Pi Zero.

  • It prioritizes security by enabling offline storage and signing of transactions, enhancing user privacy and sovereignty over their funds.

  • The wallet is designed for affordability, making it a cost-effective alternative to traditional hardware wallets.

  • Its compatibility with various Bitcoin wallet software that accommodates PSBTs, offering flexibility to users.

  • However, it requires more user involvement in setup and operation. Its not an ideal choice for beginner’s.

• Coldcard — A Bitcoin-only hardware wallet known for its robust security features and support for air-gapped operation. Coldcard is an advanced wallet we only recommend for advanced Bitcoiner’s.

  • Key features include a secure element for private key protection, open-source firmware and hardware, PIN code protection with a duress PIN option, and physical security measures like tamper-evident packaging.

  • It offers a simple user interface, microSD card support for transaction signing, and compatibility with popular Bitcoin wallet software.

  • Advanced features include multi-sig support and Partially Signed Bitcoin Transactions (PSBT) for enhanced security.

• Swan Vault — A comprehensive Bitcoin custody platform that offers secure self-custody with a very user-friendly experience.

  • Features collaborative multi-signature security, requiring two of three keys to move Bitcoin, with two held by the user and one by Swan for recovery purposes.

  • Designed for Blockstream Jade hardware wallets, it offers easy onboarding, expert security backed by regular audits, and integration with the Swan ecosystem.

  • Advanced users can enjoy full sovereignty with multi-sig wallet recovery into Bitcoin Core via Specter Wallet.

  • Provides inheritance planning for Swan Private clients.

That’s our summary of the 2024 Bitcoin self-custody landscape to date. The old adage rings true: “Not your keys, not your coins.” 

We understand self-custody can seem intimidating at first. Swan Vault aims to make it more convenient and accessible for everyone. Vault combines 2-of-3 multi-sig security with an intuitive interface.

This removes the technical hurdles that often discourages beginners. Users also receive dedicated guidance from Swan team of experts. Together, the simplified platform and helpful support empower users who still retain sole authority over their funds.

See the press release here.

Swan is a leading Bitcoin financial services company with more than 120,000 clients and 170 employees, operating globally. Established in 2019, Swan helps individuals and institutions to understand and invest in Bitcoin. The Swan app simplifies Bitcoin purchases with instant and recurring buys. Swan IRA provides a tax-advantaged solution for saving Bitcoin in retirement accounts.

For HNWIs and businesses, Swan Private provides white-glove service for large purchases, treasury solutions, and employee Bitcoin benefits. With Swan Vault, clients can easily custody their own Bitcoin with peace of mind. Financial advisors trust Swan Advisor for client Bitcoin allocations, backed by world-class custody and educational content.

Swan Managed Mining provides clients with fully segregated and dedicated mining operations, catering to their unique requirements, opportunities, and strategic advantages. Swan prides itself on exceptional client service, making Bitcoin accessible to all. For more information, please visit swan.com.