Topic: GUIDE:Important factors to take into account while choosing a wallet - page 2. (Read 561 times)

A scammer may publish the code and it may be identical to the version you are using, but scamming based on people trusting that the code is open source = security. he may make all nodes only connect to closed source software or set back doors.
In an industry built on trust, having two open source wallets with good programming and an active developer team is much better than having thousands of options that we cannot trust.

This part may be a little tricky specially if the "company" behind the wallet is trying to fool people. There are a couple of ways closed source wallets use to pretend they are open source.
- One way is to open up a GitHub account and put some code on there. It could be an older version of the wallet that is no longer updated or it usually is only part of the wallet code like the backend instead of the entire thing. People checking this on GitHub would think it is 100% open source when it is not true.
- Another way is to publish the entire code but the code has nothing to do with the binaries they release. For example there are some wallets specially the mobile wallets that have a published source code but the code is not updated with their releases! In other words they release a new version but when you check their code, you see no activity!

This is why having reproducible builds is important.

Many experienced bitcoiners use bitcoin core, but I believe it's only a matter of habit.

Personally I use Sparrow and I am very happy with it.

The cold storage wallet could be an air-gapped wallet if we deleted all wireless networks such as WiFi, NFC, etc. But the opposite is not true. What you are trying to explain can be shortened by burning tails onto a USB and then booting from that open source OS.

There is an advantage that some hardware wallets have secure elements, so at the top of the list are an air-gapped open source hardware wallets that have two or three secure elements.

The most secure approach is to have an airgapped device. That means, not only to never connect to the Internet (as with hardware wallets), but to being incapable of connecting to any device or network in general. In other words, a device that contains your master private key and transports transactions and signatures using QR codes, without connecting to your computer, such as SeedSigner.

Anyone with the TXID cannot re-broadcast it. They need to have the entire signed transaction.

Frankly, I wouldn't recommend using Bitcoin Core as a wallet, no matter how secure and developed it is. I don't remember the reason they haven't implemented a mnemonic standard like BIP39 or Electrum's, but I would not trade the comfort and security which comes from backing up my wallet in a short phrase; it greatly minimizes human error.

Nobody is going to ask you to sign a message from a Bitcoin address before you make a transaction, because the technical details of signing a bitcoin transaction and an English-language message are exactly the same.

What they might ask you for is proof that they are dealing with the real you. Not some scammer who is impersonating you with a different profile.

Take note that an airgapped device is not one that is connected to the internet and then never connected again, or one that is connected to the internet once in a while, an airgapped device is one that is never going to be connected to the internet, and it is worth mentioning that once your airgapped device is connected to the internet or you generate the seed phrase online, it no longer becomes airgapped.

Hardware wallet is the best wallet to use in storing your bitcoin for a long term, but when you don't have a hardware wallet maybe because you don't have up to $50, and you have another PC that is not in use but it is perfectly working, you can also use it as a cold storage wallet.

It is called cold storage wallet when you use it on an airgap device to generate your keys and you will never allow it to have access to the internet. You can download Electrum from the original website and use a USB to transfer the app to your PC that is not  connected to the internet and generate the seeds, or you only on your internet once to download the electrum wallet app and after that you should never connect it to the internet after you must have generated your seed.

After that, you will need an online electrum wallet to use as watch wallet, for creating transactions and broadcasting transactions, and also to track transactions. It is as save as a hardware wallet because it will never be connected to the internet, but hardware wallet are small and easy to move from one place to another.

being open source is good, but it is necessary to verify the signature and make sure that the wallet you created usin the same binary code that appears in the open source code and that the code has been reviewed thousands of times.



I do not think it is necessary, as we have BitcoinCore that does not provide the option to create a recovery seed phrase. I suggest replacing it by saying good entropy. Sometimes some wallets give 5-6 random words similar to recovery seed, which is not a good wallet.

What I am trying to say: entropy is important, not the number of recovery words.

It may also be worth mentioning that you can also use your software wallet offline and without any internet connection, let's say you use Electrum, but you either do not have money to buy a hardware wallet or you don't want to trust a hardware wallet manufacturer, you can set up your Electrum wallet on a totally airgapped device that will never be connected to the internet. You'll also need an accompanying online watch-only wallet which would be used for creating, tracking and broadcasting tx's, your airgapped wallet would only be used to sign your tx's.

Fee customization is a great wallet feature that it doesn’t only refer to setting your transaction fees high to get the transaction confirm early, but you can also use it to set transaction fee to a lower fee if the default fee selected by the wallet becomes too high and you’re probably not in a hurry to get transaction confirmed.



The 14 days is the default for a each node but it should be noted that this count begins from the day the node picks transaction, one node can pick a transaction on the 23rd October and another node could pick it on the 25th October, if the first node drops his on the 5th of November, the other node will still have his waiting in the pool till 7th. Also the first node that drops his could also comeback before the 7th November to pick the same transaction again and that’s why we see transactions been unconfirmed for over a month and yet doesn’t get dropped

There are also wallets who have an inbuilt function to rebroadcast your transaction which will allow it not to be dropped. They continue to rebroadcast the transaction and also anyone who has the TXID can also rebroadcast it

Yes, it was a mistake. Changed.

There is no BIP38 seed phrase. The seed phrase you are talking about is BIP39.


It may worth mentioning that Electrum doesn't generate BIP39 seed phrase, but it allows importing BIP39 seed phrase.


The two weeks is default time.
Nodes can have different setting and keep an unconfirmed transaction in their mempool for a longer time.

Take note that if nodes have dropped your transaction from their mempool, you can broadcast a new transaction to them, even if the previous transaction had not been flagged as RBF.
There are also nodes that have enabled full-RBF and accept the replacing transaction with higher fee even if the original transaction has not flagged as RBF and they still have it in their mempool.

When it comes to the choice of a wallet, the first thing that comes to the mind is the safe type and most recommendation you will see everywhere is to get a hardware wallet and that is because when your wallet is not connected to the internet, it protects you from insecurity such as hack and any other attempts that can stop bad people from harming your bitcoin especially when you have it in mind to keep it for long term. However, there are many people who use software wallets as well, it might not be for holding but for spending often every time.

All wallets have common features like the ability to send, ability to view received bitcoin, customized amount in QR codes and other simple features but if you want to use any wallet whether it is a hardware wallet or a software wallet, there are more primary featured that must be looked into before you accept it as a choice, I have tested, installed and see some of the basic feature that give you good choice when it comes to wallet selection, I will explain them below.

---

---

Let's delve into the general factors you should keep in mind to make a choice of wallet.

• Open source: There has been a lot of debate about the source of wallets and how safe they are, the majority of bitcoiners prefer an open-source wallet and not because an open source is the safest. It is safe to some degree in that when a wallet code(building blocks) is open to the public, it can be tested, reviewed and audited by everyone in the Bitcoin community to see if the wallet is really okay to be trusted and safe or not. Using an open-source wallet is better than a closed source because what you know is better than what you don't know. It is much easier for the community to detect a bug in an open source wallet than for a closed source, so when it comes to the choice of wallet, always make sure that it is open source.
  
  
• Standard recovery seed phrase: To have access to any wallet, you first need to have the seed phrase or Mnemonic phrase that controls the private keys to coins, no seed phrase, no private keys, this is one the best part of every wallet. There are some wallets that generate seed phrase that cannot be used in another wallet because they are not BIP 39 standard, not that these wallets that generates another type of seed phrase standard are not useful, they can only be used in other wallets compatible in their form. To avoid future problems when you want to reuse your seed phrase in the future, make sure it is BIP 39 standard seed phrase that can be imported to any other wallet, it is basically the most available type of seed phrase but there are some wallet that can be open source and not BIP 39. An example is an Electrum Wallet.
  
  
• Advance mode to run a node: One of the benefits of using some wallets is that with some tweaks and configuration, you can be your own node. What node does is that they help you communicate a transaction that is been broadcasted from the sender to the Bitcoin network and then to the miners to be included in the next block. The benefit you get from being your own node is that you don't have to depend on anyone to help you broadcast a transaction to the Bitcoin network, with your own wallet advanced configuration, you can be your own node for privacy and also help protect the bitcoin network.
  
  We have a wallet like Bitcoin Core to run a node with your own computer provided it meets the requirement space needed and also other wallets, you can configure your own node with an external set-up like plug and play where you can build your own hardware nodes and DIY(do it yourself) nodes. E.g. Raspberry Pi. So, when it comes to the choice of wallet, either hardware or software wallet, make sure you can use it to run a node.

The general and important features you need in a great wallet.

• Coin control and Label: When you receive junk of many outputs, it becomes a task to spend, when you care much about your privacy, you begin to wonder which coin to send out and which to leave because when you combine some outputs together, people watching transaction can easily identify who own an inputs. You need this feature in a wallet to spend your inputs the way you like but unfortunately, some wallets don't have coin control and label features to identify an output in a transaction.
  
  In some wallets, when you want to perform a transaction, they combine your outputs altogether, this increases the weight of a transaction when you combine different outputs all together as they increase the transaction fees, if you don't check well before you send out the transaction, it can get stuck in the mempool for a long time if the network fees spike up, this is why you need coin control and label in other to consolidate inputs when the fees is low.
  
  
• Fee adjustment: Creating and sending a transaction, by default, the fee is customized by the wallet with dependency on the fees they are getting from the bitcoin mempool but sometimes these fees change in seconds when the transaction has already been sent, you have to wait for the transaction to fee to drop to that the level of the fee you paid for your transaction to get confirm. You need this fee customized to set high fees for your transaction when you want your transaction to be faster on the bitcoin network but there are some wallets that to date, they don't have this feature yet, so avoid this type of wallet.
  
  
• RBF(RBF (Replace-by-Fee): Basically, some wallets don't have this feature yet and it is very important in a wallet. What RBF helps you do is that it can help you replace and change the transaction fee of already broadcasted transactions. When a transaction is sent into the Bitcoin network and the fee needed to confirm the transaction changes, it will stay in the mempool and if the fee doesn't come down, it will be there for a long time with a maximum of two weeks before it will drop from the mempool, this means your transaction will not confirm and you can't do anything to adjust the fees, this is what RBF does. It helps you adjust the fee to a higher fee so that it can be included in the next block ASAP.
  
  
• Sign and verify a message: Signing a message requires a private key to a wallet address and with this, you can prove to anyone that you own a wallet address. Doing a complex online business transaction sometimes requires a message to be signed before they will want to proceed, this is just to remove doubts and red flags in the end, this feature also helps in the forum to claim ownership of a wallet address. So, when you want to use a wallet, make sure it has this simple feature to verify and also sign a message.
  

Among all, there are other features needed in a wallet but if we place priority, I think these are a few most basic features you need in a wallet to enjoy the wallet in making transactions and at the same time enjoy them without any problems. Whether you want to use a hardware wallet which is a most have or a software wallet, make sure that these features are there in the wallet for comfort and privacy.