Electrum Wallet: The Complete Guide to Bitcoin's Most Trusted Desktop Wallet

Electrum Wallet: Bitcoin’s Veteran Desktop Wallet

The Electrum wallet has been part of Bitcoin since 2011, making it one of the oldest wallets still maintained. It has lasted because it does a few things very well: it’s lightweight (you don’t download the whole blockchain, which was about 800 GB in November 2026), it’s open source, and it offers advanced features such as coin control, custom fees, multisig, hardware wallet support and built-in Lightning.

Which part of this lesson is for you?

You have a hardware wallet: use Electrum only as its interface. The keys stay on the device. Read Using Electrum With a Hardware Wallet, then the security section.
You don’t: an Electrum wallet you create yourself is a hot wallet: its keys sit, encrypted, on your computer, where malware can reach them. Keep only small amounts in it, and read the setup steps and the security section.

This guide covers Windows, macOS and Linux (and Android briefly), and compares Electrum with Sparrow Wallet, its most popular modern alternative.

Key Features of the Electrum Wallet

Lightweight Architecture

Electrum doesn’t download the blockchain. It connects to Electrum servers, which keep an index of the blockchain and answer questions about your addresses. You’re up and running in a minute on any laptop. The trade-off: you rely on the server for news of your transactions, and the server sees which addresses you ask about. Running your own server removes both issues (see later).

Two ways to connect Electrum. By default, Electrum on your computer asks a public Electrum server, run by someone else, about your addresses, and the server answers with your transactions. That server sees which addresses you ask about and your IP address, unless you use Tor, and you rely on it for news of your transactions. Or Electrum asks your own server, running on your own full node: no outside server learns which addresses are yours and you rely only on your own node, but the node needs the whole blockchain, about 800 GB in November 2026, so plan for a 2 TB drive. — **Electrum doesn’t download the blockchain: it asks a server, and that server learns your addresses.** A public server sees which addresses you ask about and, unless you use Tor, your IP address. Your own server on your own node keeps that to yourself.

Seed Phrase Backup

When you create a wallet, Electrum shows a seed phrase, but in its own format, not BIP39. Electrum doesn’t generate BIP39 seeds at all. An Electrum seed restores in Electrum but won’t restore correctly in most other wallets (Sparrow, BlueWallet, hardware wallets). Electrum can, however, restore a BIP39 phrase made elsewhere, and a Trezor 20-word backup.

Hardware Wallet Integration

Electrum works with Ledger, Trezor, Coldcard, BitBox02 and other hardware wallets. Electrum is the interface; all key operations happen on the device. Many experienced users prefer this to the makers’ own apps.

Multisig Support

Electrum supports multi-signature wallets, which need several keys to approve a payment (for example any two of three). It takes more manual steps than Sparrow’s multisig wizard; Course 5 covers multisig.

Coin Control, Custom Fees and Fee Bumping

You can choose exactly which coins a payment spends, set the fee rate yourself, and raise the fee on a payment that’s stuck. The terms are explained in the glossary below.

Tor Support

Electrum can send its traffic through Tor, a network that hides your IP address, so the server can’t link your addresses to your location.

Lightning Network

Since version 4.0 (2020), Electrum includes a Lightning wallet: you can open channels and pay Lightning invoices from the same app. For everyday Lightning on a phone, dedicated wallets are smoother: see the Lightning wallets lesson.

Electrum vs Sparrow Wallet: A Direct Comparison

Feature	Electrum	Sparrow Wallet
First released	2011	2020
Platforms	Windows, macOS, Linux, Android	Windows, macOS, Linux
Blockchain data	Electrum servers (public or your own)	Public Electrum servers, your own server, or Bitcoin Core
User interface	Functional but dated	Modern, visual, well organised
Hardware wallet support	Ledger, Trezor, Coldcard, BitBox02, others	Ledger, Trezor, Coldcard, BitBox02, Keystone, others
Multisig setup	Supported but manual	Guided wizard
Coin control	Yes (Coins tab)	Yes (visual view with transaction graph)
CoinJoin / mixing	No built-in support	No built-in support (Whirlpool client removed in 1.9.0, April 2024)
Lightning Network	Built-in	No
Custom fees, RBF	Yes	Yes
PSBT support	Yes	Yes (extensive)
Air-gapped signing	Via file, or one QR code in Electrum’s own format (small transactions only)	Via QR codes, SD card or file
Seed format it creates	Electrum’s own (restores BIP39 and SLIP-39)	BIP39
Development	Maintained, slower pace	Active, frequent updates

When to Use Electrum

You want a light install that runs anywhere, including Android.
You want Lightning in your desktop wallet.
You value a long track record.
You’re on an older machine where Sparrow’s heavier interface is slow.

When to Use Sparrow Wallet

You want the clearest view of your transactions and coins.
You’re setting up multisig and want a guided wizard.
You want detailed coin labelling for privacy.
You sign by QR code (Coldcard Q, SeedSigner, Keystone).
You want a wallet that creates BIP39 seeds.

Many experienced users keep both: Electrum for quick payments and Lightning, Sparrow for multisig and privacy.

How to Install and Set Up the Electrum Wallet

These steps are for the desktop version. If you have a hardware wallet, do Step 1 and then skip to Using Electrum With a Hardware Wallet.

Step 1: Download Electrum From the Official Source

Go to electrum.org, and only there. Electrum users have been the target of sophisticated phishing: starting in late 2018, malicious servers pushed fake “update required” messages into wallets, linking to trojanised versions that stole seeds (more under Security).

If you can, verify the download’s signature: Electrum signs every release, and the download page explains how to check it. Course 5’s How to Verify Bitcoin Software Before You Install It walks through a signature check from start to finish.

Step 2: Create a New Wallet

Launch Electrum. It asks you to create or open a wallet file.
Choose create a new wallet and give it a name.
Choose Standard wallet.
Choose Create a new seed.
Keep the seed type Segwit (the default; lower fees).

Step 3: Understand Electrum’s Seed Format

Electrum creates seeds only in its own format. It includes a version number in the seed, so on recovery Electrum knows what kind of wallet to rebuild. The downside: other wallets that expect BIP39 won’t restore it.

There is no “make a BIP39 seed” option when creating a wallet in Electrum. If you want a BIP39 seed, create it in another BIP39 software wallet, then bring it into Electrum by choosing I already have a seed, clicking Options and ticking BIP39 seed. Electrum then asks for the derivation path (the branch of the key tree your addresses use) and can try to detect existing accounts for you. Bitcoin Address Types and Derivation Paths shows which path goes with which address type. Never type the words of a hardware wallet into Electrum or any computer: to use a hardware wallet with Electrum, connect it with Use a hardware device, as shown below.

If you’ll only ever use Electrum, its own format is fine. If you might switch wallets, start from a BIP39 seed made elsewhere. One trade-off: in a BIP39 wallet Electrum can’t recover Lightning channels from the seed, so if you open channels there, save the channel backup Electrum offers each time.

Two kinds of seed and where each can be restored. Electrum's own seed, the only kind Electrum creates, restores in Electrum but won't restore correctly in most other wallets, such as Sparrow, BlueWallet and hardware wallets. A BIP39 seed made on a hardware wallet or another BIP39 wallet restores in Electrum, with the option I already have a seed, and in most other wallets, because BIP39 is the standard most use. If you might switch wallets, start from a BIP39 seed made elsewhere. — **An Electrum seed only goes back into Electrum.** A BIP39 seed made elsewhere works in Electrum and in most other wallets, so start from one if you might switch wallets later.

Step 4: Write Down Your Seed Phrase

Electrum shows a 12-word seed. Write it on paper, numbered: the same rules apply as for any seed phrase backup. Electrum then asks you to type it back to confirm you copied it correctly.

Step 5: Set a Wallet Password

Electrum asks for a password that encrypts the wallet file on your disk. Without it, anyone with access to your computer could open the wallet and spend. Use a strong, unique password. It’s not the seed: the seed restores the wallet anywhere; the password protects this file on this computer.

Using Electrum With a Hardware Wallet

This is one of the best ways to use Electrum: you get its features (coin control, custom fees, fee bumping, labels) while the keys stay on your hardware wallet.

Setup Process

Connect and unlock your hardware wallet. (A Coldcard can instead export its public key by microSD; see the Coldcard guide below.)
In Electrum, create a new wallet and choose Standard wallet.
Choose Use a hardware device. Electrum lists the device it finds; select it.
Accept the suggested derivation path unless you know you need another one.
Electrum stores only your public keys and shows your addresses and balance.

To send, Electrum prepares the payment and passes it to the device, which shows the address and amount; you check them on its screen and approve there. Electrum never sees the private keys. This is popular with Coldcard owners, since Coldcard has no app of its own: see our Coldcard Mk4 setup guide.

Glossary for the Advanced Features

UTXO (coin): one chunk of bitcoin you received, sitting at one of your addresses. Your balance is the sum of your UTXOs; a payment spends one or more of them. Course 1’s transactions lesson explains more.
sat/vB: the fee rate, in satoshis per virtual byte of transaction size. Bigger transactions (more coins spent) cost more at the same rate.
Mempool: the waiting room of broadcast transactions not yet in a block. Miners pick the best-paying ones first.
RBF (Replace-By-Fee): sending a new version of your own unconfirmed payment with a higher fee, so it confirms sooner.
CPFP (Child Pays For Parent): speeding up an unconfirmed incoming payment by spending it with a high fee; miners take both to collect that fee.
xpub (extended public key): a public key from which all of a wallet’s addresses can be calculated, but no spending keys. Anyone with it can see your whole balance and history, so keep it private.
PSBT (Partially Signed Bitcoin Transaction): a standard file format for passing an unsigned or partly signed payment between a wallet and a signing device.

Advanced Electrum Features

Coin Control: Choosing Which Coins to Spend

By default Electrum picks which coins to spend. With coin control you choose. Why it matters: if you received 0.1 BTC from an exchange and 0.05 BTC from a friend, spending both in one payment tells anyone watching the blockchain they belong to the same person. Coin control lets you keep them apart.

Two coins in your wallet: 0.1 BTC from an exchange and 0.05 BTC from a friend. Spent together in one payment, they tell anyone watching the blockchain that both coins belong to one person. With coin control you freeze the 0.1 BTC coin, so Electrum won't spend it, and pay with the 0.05 BTC coin alone: the two coins stay apart and this payment doesn't link them. — **Spending two coins in one payment tells anyone watching they belong to the same person.** Coin control lets you choose which coins a payment uses, and freeze the ones you want to keep apart.

Open the Coins tab (View → Coins if it’s hidden).
Right-click a coin to freeze it (Electrum won’t spend it) or to label it.
Select the coins you want to spend, right-click and choose Spend (older versions say “Add to coin control”), then make the payment in the Send tab as usual.

Fees: Custom Rates, RBF and CPFP

Custom fees: in the Send tab, set the rate in sat/vB. Check a mempool explorer such as mempool.space to see what’s needed right now.
RBF: if your payment is stuck, right-click it in History and choose to increase the fee. Electrum creates a replacement with a higher fee. On a hardware wallet, you approve it on the device: check the address and amount again.
CPFP: for an unconfirmed incoming payment, right-click it and choose “Child pays for parent”. Your fee pays for both transactions, so pulling a large exchange batch through can cost more than waiting; Your First Withdrawal works through an example.

Watch-Only Wallets

A watch-only wallet shows addresses and balances but can’t spend. Useful for checking a hardware wallet’s balance without connecting it, or for monitoring savings from an everyday computer. To create one:

Export your xpub (it may be labelled zpub for Native SegWit) from your hardware wallet or its app. Treat it as private: anyone who sees it can follow every address of that wallet, past and future, so give it only to wallet software you run yourself, never to a website, a “portfolio tracker” or anyone who asks for it.
In Electrum: File → New/Restore, name the wallet, choose Standard wallet.
Choose Use a master key (labelled “Use public or private keys” in some versions) and paste the xpub.
Electrum confirms it’s opening a watching-only wallet.

No private keys are stored, so even a fully compromised computer can’t move the funds, though it can see your balance and history.

Three ways to use Electrum. On its own, Electrum keeps the private keys on your computer, encrypted with your password; if the computer is compromised, malware can reach the keys, so keep only small amounts in it. With a hardware wallet, the computer holds only public keys and the private keys stay on the device; a compromised computer can't take the keys, and if it shows a wrong address, the device's screen lets you catch it. As a watch-only wallet, Electrum holds only the xpub, which shows your addresses but can't spend; a compromised computer can't move the funds but can see your balance and history. — **What a hacked computer can do depends on where the private keys are.** Used on its own, Electrum keeps the keys on your computer. With a hardware wallet they stay on the device, and a watch-only wallet holds none at all.

Your Own Electrum Server

By default Electrum connects to public servers, whose operators can see which addresses you query and from which IP. You can run your own server (Electrum Personal Server, ElectrumX or Fulcrum) on top of your own Bitcoin node and connect only to it. That needs a full node, which downloads the whole blockchain (about 800 GB in November 2026; plan for a 2 TB drive), but then no outside server learns which addresses are yours. Course 4 covers setting up a Bitcoin node.

Security Considerations for Electrum Users

Update (November 2026): Malicious Servers Showing Fake Transactions

Electrum 4.8.3 (October 2026) fixes a serious flaw that some public servers were already exploiting. In plain words: after you sent a payment, a malicious server could hide it and show your wallet a fake one instead, paying an address the attacker had made to end in the same four characters as the real one. If you then raised the fee on that “stuck” payment, you would sign a real transaction paying the attacker. One user lost money this way (Electrum security advisory, 24 October 2026; our advisory).

Update to Electrum 4.8.3 or later, from electrum.org.
Make it a habit: for every payment and every fee bump, compare the whole destination address and the amount on your hardware wallet’s screen (or, without one, in the confirmation window) with the address you meant to pay. Checking only the last few characters is exactly what this attack relied on.
Connect to your own Electrum server if you can. Electrum says clients that connect only to servers they trust are not affected.

The attack fixed in Electrum 4.8.3, in three steps. 1: you send a payment to the address you meant. 2: a malicious server hides it and shows your wallet a fake stuck payment instead, to the attacker's address. 3: you raise the fee on that payment and sign a real payment to the attacker's address. The attacker's address is a look-alike: it ends in the same last four characters as the one you meant, and only checking the whole address shows the difference. For every payment and every fee bump, compare the whole address and the amount on your hardware wallet's screen, or in the confirmation window if you don't have one. Run Electrum 4.8.3 or later, and use your own server if you can. — **Checking only the last few characters is exactly what this attack relied on.** The attacker’s address ends like the one you meant, so a glance at the end lets it through. Compare the whole address and the amount every time, on the device’s screen if you have one.

Phishing Attacks: Fake Update Prompts

The best-known attack on Electrum users: malicious public servers sent wallets fake “update required” messages with a link. Users who followed it installed a trojanised Electrum that stole their seeds, and millions of dollars were lost.

Download Electrum only from electrum.org, typing the address yourself.
Treat any message urging you to update right now through a link as an attack. Update by going to electrum.org yourself. The same trick is used against every wallet; The Scams That Empty Self-Custody Wallets covers the others.
Verify download signatures if you can.
Use your own server to avoid malicious public ones.

Server Privacy Risks

Any server you connect to sees the addresses your wallet asks about and can link them to your IP address. To reduce this: turn on Tor in Electrum’s network settings (proxy), which hides your IP but not your addresses, or run your own server, which keeps both to yourself. Course 5’s Network Privacy: Tor, VPNs and Your Own Node compares the options.

Wallet File Encryption

Your wallet file (in ~/.electrum/wallets/ on Linux, or the equivalent elsewhere) holds your seed, encrypted with your password. Someone who copies the file can try to guess a weak password offline. Use a strong password and turn on full-disk encryption. Full-disk encryption, a setting in your computer’s operating system, keeps the whole drive unreadable if the computer is stolen while switched off.

Supply Chain Risks

Any software could in theory be distributed in a tampered version, which is why signature checks matter. Pairing Electrum with a hardware wallet means even a tampered Electrum can’t take your keys; it could still try to trick you into approving a wrong address, which the device’s screen lets you catch.

Electrum Wallet on Mobile (Android)

Electrum runs on Android (not iOS), with a subset of the desktop features, including Lightning. On a phone it’s a hot wallet for spending money. For Lightning on a phone, dedicated wallets are usually smoother: see the Lightning wallets lesson. Savings belong on a hardware wallet or another cold storage setup.

Frequently Asked Questions

Is Electrum wallet safe?

Electrum is open source, widely reviewed and has been around since 2011. The main risks are fake downloads, malicious servers, and, if you don’t use a hardware wallet, keys on your computer. Download only from electrum.org, run 4.8.3 or later, and pair it with a hardware wallet for anything you can’t afford to lose.

Is Electrum good for beginners?

It has a steeper learning curve than BlueWallet or the makers’ apps (Ledger Wallet, Trezor Suite), and its interface is less polished. Beginners who want a desktop wallet may find Sparrow gentler. Electrum’s basic send and receive are straightforward once set up.

Can I use Electrum with a hardware wallet?

Yes: create a wallet and choose “Use a hardware device”. All signing happens on the device. See the section above.

Does Electrum support Lightning Network?

Yes, since version 4.0. It works; for frequent Lightning use, dedicated wallets such as Phoenix or Zeus are a better fit.

Should I use Electrum or Sparrow Wallet?

Electrum if you want Lightning, a light install, Android or a 15-year track record. Sparrow if you want a modern interface, visual coin control and labelling, easy multisig, or a wallet that creates BIP39 seeds. Both work well with hardware wallets.

What’s the difference between Electrum’s seed and a BIP39 seed?

BIP39 is the standard most wallets use. Electrum’s own seeds include version information that lets Electrum rebuild the right wallet type, but other wallets generally can’t restore them. Electrum can’t create a BIP39 seed; it can restore one made elsewhere (“I already have a seed” → Options → BIP39). Note that not all hardware wallets use BIP39 by default: Trezor Safe devices make a 20-word SLIP-39 backup, which Electrum can also restore.

How do I move from Electrum to Sparrow?

If your Electrum wallet came from a BIP39 seed, restore the same seed in Sparrow. If it uses Electrum’s own seed format, import the Electrum wallet file into Sparrow; encrypted files work, and your labels come across. Your written seed still won’t restore in Sparrow, though. For a BIP39 backup, create a new Sparrow wallet, send your bitcoin to it in an ordinary on-chain payment, and re-label your coins.

Check Your Understanding

1. You created a wallet in Electrum on your laptop with no hardware wallet. Is it hot or cold, and what follows from that?

Answer

Hot: its keys are on an internet-connected computer, protected only by the file password. Keep small amounts in it and keep savings on a hardware wallet.

2. A friend wants a BIP39 seed and asks where Electrum’s “BIP39” checkbox is when creating a wallet. What do you tell them?

Answer

There isn’t one: Electrum creates only its own seed format. Create the BIP39 seed in another BIP39 software wallet, then restore it in Electrum with “I already have a seed” → Options → BIP39 seed. For a hardware wallet, never type its words into Electrum: connect the device with “Use a hardware device” instead.

3. Your payment looks stuck and you’re about to raise the fee. What do you check first, and why?

Answer

The whole destination address and the amount, on your hardware wallet’s screen if you have one, against the address you meant to pay. A malicious server can show a fake “stuck” payment to a look-alike address, so the fee bump would pay the attacker. Also make sure you’re running Electrum 4.8.3 or later.