The most popular Bitcoin wallets in Germany

Money in a German bank account is a claim against the bank, and the statutory deposit guarantee covers up to 100,000 euros per customer and bank. Shares in a securities account sit with a custodian bank in your name. Bitcoin works differently: whoever holds the private key can move the coins, and nobody can reverse a transfer. BaFin states (in German) that crypto-assets, and cryptocurrencies in particular, are as a rule not covered by deposit protection or investor compensation.

When a firm keeps bitcoin for you, it runs a custody business. In Germany that needs a BaFin license under the Banking Act (KWG), and across the EU an authorization as a crypto-asset service provider under MiCA, Regulation (EU) 2023/1114. Article 75(7) of MiCA keeps client crypto-assets legally apart from the provider's own estate, so its creditors have no claim on them if it goes bankrupt. With self custody you hold the keys yourself and no license applies: according to BaFin, making or selling a hardware wallet is not custody when the vendor has no access to the keys, as the hardware wallet answer explains. Bitcoiners sum up the difference as "not your keys, not your coins". More on the licensed side: crypto custody.

Hot wallet and cold wallet

A hot wallet keeps its keys on a device that is online, such as a phone app or a desktop program. A cold wallet creates and stores its keys offline, usually in a hardware wallet that signs a transaction inside the device and shows the address on its own screen. The term warm wallet has no fixed meaning; people use it for setups in between, such as a hardware wallet that is plugged in or paired over Bluetooth each time it signs. Air-gapped means the signing device never connects to the computer: the transaction travels as a QR code or on a microSD card, as with Coldcard or SeedSigner.

Custodial and non-custodial

In a custodial wallet a provider holds the keys, which is how broker apps such as BISON and Bitpanda work. In a non-custodial wallet, also called a self-custody wallet, only you hold them. The crypto wallet answer compares both.

Seed phrase and passphrase

The seed phrase, 12 or 24 words, is the backup from which the wallet recreates every key. Anyone who has the words has the bitcoin, and whoever loses both the words and the device has lost it. A passphrase is an extra word or sentence added to the seed phrase that opens a separate wallet, so the 24 words alone are not enough for a thief. Some owners stamp the words into a steel plate instead of keeping them on paper. The difference between key and backup: private key vs seed phrase.

Multisig

A multisig wallet needs several keys to sign, for example two of three hardware wallets from different makers. One lost device does not lose the bitcoin, and one stolen device cannot move it. Sparrow, Nunchuk and BlueWallet set up such wallets.

Lightning

The Lightning Network is a payment layer on top of Bitcoin for fast, cheap payments. A Lightning wallet on a phone is a hot wallet, and Shift Crypto describes the one in its BitBoxApp as intended for smaller amounts.

Bitcoin-only or multi-coin

A Bitcoin-only device runs firmware that supports nothing but Bitcoin. Shift Crypto's argument for it is that less code means less attack surface. Multi-coin devices such as Ledger's add apps for other crypto-assets.

The BitBox02 comes from Shift Crypto, a company based in Zurich that designs and manufactures its hardware and software in Switzerland. The Bitcoin-only edition is locked to Bitcoin firmware at the factory and cannot be reset to support other coins; a Multi edition exists for people who hold other assets too. The backup goes on a microSD card, with the 24 recovery words as an extra option, and firmware and app are open source. Blocktrainer, a German Bitcoin education site that says its pages can contain partner links, names the BitBox02 its number one recommendation for storing bitcoin simply and securely.

The newer BitBox02 Nova works with iPhones, and the original BitBox02 does not, as the Blocktrainer overview notes. The BitBoxApp also has a Lightning wallet whose keys live in the app as a hot wallet for smaller amounts; it is restored from the same BitBox backup.

Trezor is made by SatoshiLabs in Prague. The Safe 3 has buttons and a small OLED screen, the Safe 5 a color touchscreen, and the Safe 7 is the newest model. The Safe 3 and Safe 5 use a secure element certified to EAL6+, the design is open source, and each model also comes as a Bitcoin-only version. Blocktrainer lists the Safe 3 for its price. According to Shift Crypto's own comparison, Trezor's Bitcoin-only firmware can be switched back to the multi-coin version.

Ledger, based in Paris, states that it has sold more than eight million signing devices. The range covers the Nano S Plus, Nano X, Nano Gen5, Flex and Stax, and the Ledger Wallet app manages more than 15,000 crypto-assets. Ledger has no Bitcoin-only edition. Blocktrainer lists the Nano X as its pick for people who also hold other coins.

Coldcard is built by Coinkite in Toronto and supports Bitcoin only. The Mk5 has a numeric keypad, the Q a full keyboard and a QR scanner; both can sign air-gapped through microSD card, QR code or NFC, and both use two secure elements from different vendors. Coldcard needs no app of its own, so owners pair it with Sparrow, Electrum or another wallet. Duress PINs and decoy wallets protect the owner if someone forces them to unlock the device.

Blockstream Jade comes as Jade Core and Jade Plus; the Plus adds a camera for QR codes and support for SD cards and USB drives. Both are open source and support Bitcoin and Liquid, Blockstream's sidechain. Blocktrainer lists the Jade for its price-to-performance ratio. It pairs with the Blockstream App on phone or desktop.

SeedSigner is a signing device you build yourself from standard parts that usually cost less than 50 US dollars. It has no Wi-Fi or Bluetooth and talks to the wallet software only through QR codes. It is stateless: it keeps no keys after it is switched off, so the seed is scanned in again at each use.

BlueWallet is a free, open-source Bitcoin wallet for iPhone and Android, and its keys never leave the phone. It offers multisig vaults and watch-only wallets that show the balance of a Coldcard, Jade or Keystone without holding its keys. Lightning works only through an LNDhub server the user connects.

The Blockstream App is an open-source wallet for iOS, Android, macOS, Windows and Linux that shows on-chain bitcoin, Lightning and Liquid in one view. Its keys sit on the phone, or on a Jade when the two are paired.

Sparrow Wallet is a Bitcoin desktop wallet under the open-source Apache 2 license. It supports all common hardware wallets over USB or air-gapped, runs single-signature and multisig wallets, and lets you pick which coins are spent and at what fee. Tor is built in.

Electrum, created by Thomas Voegtlin, is an open-source Bitcoin wallet for Windows, macOS, Linux and Android. Keys are encrypted and never leave the computer, and the wallet can be recovered from its seed phrase. It works with hardware wallets and multisig, and release 4.0.1 added Lightning.

Nunchuk is a Bitcoin wallet for phone and desktop built around multisig. Family members or business partners can manage bitcoin together, and its inheritance plan uses on-chain timelocks that Nunchuk calls "designed to outlive the company that created it".

Phoenix, built by ACINQ, is a non-custodial Bitcoin wallet that runs natively on Lightning. You keep control of your key, and the app handles the Lightning channels in the background.

Wallet of Satoshi, an Australian company, was long known as a custodial Lightning wallet. EU users now see the message that the custodial service is no longer available in their region and can keep using the app in self-custody mode, as L0la L33tz reported for The Rage, citing MiCA and the EU tax reporting rules of DAC8.

Relai is a Bitcoin-only app from Zurich for buying bitcoin. It states that the bitcoin goes into a wallet only the user can access, and that it has more than 100,000 users. In the EU, Relai is registered as a crypto-asset service provider under MiCA with the French AMF.

Pocket is a Swiss Bitcoin-only service that converts bank transfers into bitcoin and sends them straight to the customer's own wallet. Customers use it for one-off purchases or for recurring ones that land directly on a hardware wallet.

21bitcoin is a Bitcoin-only app run by FIOR Digital GmbH in Austria, licensed under MiCA by the Austrian FMA and passported to Germany. Customers choose between custody at BitGo Europe and automatic transfers to their own hardware wallet. 21bitcoin states it has more than 100,000 customers in Europe.

In broker apps the provider holds the keys. Crypto bought in BISON, the app of the Boerse Stuttgart Group with more than 1.05 million users, is held by Boerse Stuttgart Digital Custody GmbH. Customers can withdraw it free of charge (in German) to a wallet of their own, 24 hours after a purchase at the earliest; under the Transfer of Funds Regulation BISON may ask for proof that the wallet is theirs, such as a Satoshi test or a digital signature. Bitpanda keeps customer crypto in offline wallets and lets customers move it to their own. Both firms and their licenses are in the largest crypto exchanges in Germany.

Buy a hardware wallet from the maker's shop or a reseller the maker lists, never second-hand, and check the seal. On first start, the BitBoxApp, Ledger's app and Trezor Suite each check that the device is genuine. Install firmware only through the maker's own app. Never type the seed phrase into a website, a phone app or a form: a hardware wallet asks for it only on its own screen during a recovery. Makers do not call their customers, and BitBox warns on its site that it offers no phone support and will never ask for the 24 recovery words. Before sending a large amount, send a small test amount and compare the address on the device screen with the one you expect. How fraud with fake platforms works: crypto fraud investigation.

Arnold's BitBox02 setup tutorial on Blocktrainer (in German) goes through unboxing, the microSD backup and writing down the 24 words in the right order. In episode 9 of the podcast Bald in Bitcoin (in German), Markus Vorsmann, who works in the BitBox environment, talks about seed words, test transactions, recovery and fraud. Jess Houlgrave's article Is Bitcoin Self-Custody Under Threat in Europe? in Bitcoin Magazine explains how the Transfer of Funds Regulation and the Satoshi test affect withdrawals to your own wallet.

At Finance Loop meetups you get into conversation with Bitcoin people and can ask them how they set up their wallets. Finance Loop's chapter meetups take place in Frankfurt, Munich and Berlin. In Frankfurt, the independent Frankfurt Bitcoin Meetup meets every third Thursday of the month; it continues the city's original Bitcoin meetup, which Bitcoin veterans revived, and a volunteer team runs it. Finance Loop does not run it, and there too you can talk about wallets with bitcoiners. More on the city: Bitcoin in Frankfurt.

For the investor view, Finance Loop's Bitcoin for Investors masterclass covers custody models and investor risk management next to portfolio allocation. It runs across Germany, as described under Bitcoin seminar in Germany, and in Frankfurt under Bitcoin seminar in Frankfurt. Finance Loop sells no wallet and recommends no single product.

The answer depends on the amount. For small sums, a phone app that keeps the keys on the phone, such as BlueWallet or Phoenix, is the simplest start. For savings, the German guide Blocktrainer names the BitBox02 first, and Trezor and Ledger devices also keep the key offline. A broker app such as BISON is easier still, but there the provider holds the keys.

Both make hardware wallets with a secure element and a screen for checking addresses. Trezor publishes its design as open source and offers Bitcoin-only firmware for each model. Ledger has no Bitcoin-only edition, and its Ledger Wallet app supports more than 15,000 crypto-assets. For bitcoin alone, Trezor's Bitcoin-only version, the BitBox02 Bitcoin-only edition and Coldcard are the devices built for it.

No. The German deposit guarantee of up to 100,000 euros covers bank deposits, and BaFin states that cryptocurrencies are as a rule not covered. With a licensed custodian, MiCA keeps your crypto-assets apart from the provider's estate in an insolvency. With self custody, your protection is the seed phrase and how well you keep it.