Sparrow vs Electrum: Built-In Tor or Built-In Lightning
Published October 23, 2026· By Juan Martinez
Both free Bitcoin wallets start on public servers. Sparrow uses a standard BIP39 seed and ships Tor; Electrum has its own seed format, Lightning and Android.
Sparrow vs Electrum is a choice between two free desktop Bitcoin wallets that keep the keys on your computer. Both are open source, both handle only bitcoin, and both, out of the box, ask public servers run by strangers about your addresses. Electrum has been around since 2011 and is developed by a company in Berlin. Sparrow appeared in 2020 and is built by one developer in South Africa.
For someone who keeps bitcoin on one computer, the real differences are in four places: whether the seed phrase can be restored in another wallet, how much work it takes to stop strangers from seeing your addresses, the security record, and two features only Electrum has: an Android app and Lightning payments, which run through payment channels outside the main blockchain.
In our reviews, as of 22 October 2026, Sparrow Wallet is rated 7.8 and Electrum 7.3. Sparrow is ahead in Key Custody & Recovery (8.5 against 7.5), Network & Metadata Privacy (7.5 against 6.5) and Price & Value (10 against 9.5). Electrum is ahead in Security & Transparency (7.0 against 6.5), and the two are level on Usability & Chain Support at 7.0.
| Sparrow Wallet | Electrum | |
|---|---|---|
| Rating | 7.8 | 7.3 |
| What the Default Server Learns | One public server, picked at random, sees your addresses, balance and IP address | One of about ten public servers gets all your addresses; every connected server sees your IP address |
| Using Your Own Node | Connects to Bitcoin Core directly (a pruned node works) or to your own Electrum server | Needs your own Electrum server running in front of your full node |
| Tor | Built in | Through a proxy you set up |
| Seed Format | Standard phrase (BIP39) | Own format |
| Seed Portability | Restores in other wallets | Limited outside this wallet |
| Networks | Bitcoin | Bitcoin, Lightning |
| Platforms | Windows, macOS, Linux; no phone app | Windows, macOS, Linux, Android; no iOS app |
| Known Security Problems | None known in Sparrow's own software | 2018: a website could send commands to the wallet; 2018: attacker-run servers showed messages linking to fake updates; 2023: Lightning flaw on Android; 2026: plugin flaw |
| Cost | Free | Free; optional two-factor service costs 0.0005 BTC per 20 outgoing transactions |
Want to compare every field side by side? Open the full comparison table.
The seed phrase and where it can be restored
Both are self-custody wallets: according to each project, the keys are created on your computer and never sent to anyone. Electrum encrypts the wallet file by default; Sparrow encrypts it if you set a password. Neither developer can restore a wallet for you. If you lose the seed phrase, and the computer with it, the bitcoin is gone in both.
The phrases are not the same kind. Sparrow creates a standard BIP39 phrase of 12 to 24 words, a format almost every Bitcoin wallet can read. If Sparrow stopped being developed tomorrow, you could type the phrase into another wallet.
Electrum creates a 12-word phrase from the same 2048-word list, but in its own format: a version number is hidden in the phrase, and a wallet that reads only BIP39 phrases cannot restore it. Electrum publishes the format, its code is MIT-licensed, and it can export your private keys for use in other software, so the funds do not depend on Electrum Technologies staying in business.
Electrum can also restore a BIP39 phrase made elsewhere. In such a wallet, though, Electrum does not derive the Lightning keys from the phrase, so open Lightning channels cannot be recovered from it; you need the channel backups the app exports, files that let you claim the funds on-chain after asking the other side to close the channel.
Both support an optional passphrase on top of the phrase, and both show the phrase of a newly created wallet on the computer screen. Malware on that computer can read it in either app. The way around this in both is to keep the keys on a hardware wallet and use the desktop app only to build and send transactions. Sparrow talks to hardware wallets over USB, QR codes and SD cards; Electrum works with several hardware wallets as signers. Both build multisig wallets that need several keys to spend.
What the server sees
To show your balance, each wallet asks an Electrum server about your addresses. Anyone can run such a server. Sparrow runs none of its own, and none of the 84 servers in Electrum’s built-in list is on Electrum’s own domain.
Sparrow, if you set nothing up, picks one public server at random from a built-in list run by third parties. That operator sees your wallet’s addresses, its balance and your IP address. Sparrow’s setup guide says so and advises against a public server for significant amounts.
Electrum connects to about ten servers picked from a public list. One of them receives all the wallet’s addresses so it can report new payments; Electrum’s own documentation says that server “can now reasonably guess that all these addresses belong to the same entity”. Every connected server sees your IP address.
So the default is close: in both, a stranger can link your addresses to your IP address. The difference is in what it takes to change that.
Your own node
Sparrow connects straight to Bitcoin Core, the standard full node software, on the same computer or another one, and a pruned node that keeps only recent blocks also works. Then no outside operator learns which addresses are yours.
Electrum needs an Electrum server running in front of your node, and you tell the app to connect only to it. That is one more piece of software to install and keep running, on top of the node itself.
Tor
Tor hides your IP address from the servers. Sparrow ships it inside the app: it starts by itself when you point Sparrow at a .onion address, the address of a server reachable only through Tor, and you can send all connections through a Tor proxy. Electrum does not include Tor. It can send all its traffic through Tor if Tor is already running on the computer, and looks for it on the usual local ports, so you have to install and run Tor separately. Neither app uses Tor until you set it up, and in both it hides only your IP address: a public server still sees which addresses belong together.
Other requests the app makes
Even with your own node, Sparrow by default asks CoinGecko for exchange rates, mempool.space for fee estimates and sparrowwallet.com for update notices. Each of these sees your IP address; Sparrow says your balance is never sent. The exchange rate and the update check can be switched off, and with a Tor proxy set they go over Tor. Sparrow sends no usage statistics.
Electrum’s fiat prices and update check are off by default. If the app crashes, it offers to upload a report to GitHub, where it becomes public; you see the report first, and it may contain your IP address and device name. By default, Lightning payments in Electrum go through one of three fixed trampoline nodes, one run by Electrum, which find the route on the app’s behalf and so take part in every payment you send.
Both have full coin control: you choose which earlier payments a new one spends, so coins from different sources are not merged by accident. Sparrow adds payjoin, where the recipient adds an input of their own; silent payment addresses, where you publish one address and each payment lands at a fresh one; and a payment that looks like a joint transaction of two people. Neither has a built-in purchase, so neither asks for identity documents.
Security record
Neither has a published security audit, and neither runs a bug bounty. Both take security reports privately.
Electrum has an incident history. In January 2018, a flaw in versions 2.6 to 3.0.4 let a malicious website send commands to a running Electrum; wallets without a password could be emptied, and Electrum knew of no theft through it. In December 2018, an attacker started many Electrum servers that answered payments with an error message telling users to install a “new version”, which was malware; every release before 3.3.3 displayed such messages. In 2023, Electrum disclosed a flaw in its Android app that let a direct Lightning channel partner take a payment without passing it on, fixed in April 2023. In April 2026, it fixed a flaw that let a program already on the computer make Electrum load its own plugin code. Every Electrum release since August 2025 (4.6.2 onward), up to 4.8.2 in September 2026, is marked as a security update, and the app does not check for updates unless you turn that on.
No security incident in Sparrow’s own software is known. Version 2.5.4, in August 2026, was largely a hardening release after an AI-assisted code review; the developer said nothing found was likely to put funds at risk. Fewer published problems do not prove a stronger design: no outside auditor has examined either app, and Electrum has been public since 2011, nine years longer than Sparrow.
Both projects are targets for impersonators. Electrum’s documentation warns of lookalike sites advertised with paid search ads, and says the project buys no Google ads. In July 2026, three Bitcoin holders sued Apple over a fake “Sparrow Wallet” iPhone app that asked for their seed phrases, saying they lost about $1.8 million in total; Sparrow has no iPhone app. Download Electrum only from electrum.org or the app-store links it gives, and Sparrow only from sparrowwallet.com or its GitHub page, and check the signature.
Who maintains Sparrow and Electrum
Both are open source: Sparrow under Apache 2.0, Electrum under MIT, along with ElectrumX, the server software the project names as official. Both document reproducible builds. Electrum’s current release is signed by five builders, three of them outside the two developers with write access to the code, and changes to its website need both lead developers’ signatures. Sparrow’s releases are signed by its developer; outside builders have published matching rebuilds only for versions up to 1.6.6 from 2022, and the macOS download cannot yet be rebuilt to an identical file.
The difference follows from who maintains each. Sparrow is the work of Craig Raw, one developer, funded by donations, with no company and no support team; help comes from a community Telegram group. In October 2026 it was still updated regularly. Electrum is developed by Electrum Technologies GmbH in Berlin, founded in 2013 by Thomas Voegtlin, who wrote the first version, with two developers who hold write access. It gives no private support either, and says anyone offering “Electrum support” in a private message is most likely trying to steal your bitcoin.
Price
Both are free. Sparrow charges nothing of its own; you pay only the Bitcoin network fee, which you choose. Electrum’s only paid part is the optional two-factor wallet type, in which TrustedCoin, a US cosigning service, holds one of three keys and adds a fee to your outgoing payments: 0.0005 BTC for every 20 transactions. TrustedCoin receives the wallet’s master public keys, and through them all its addresses, logs your IP address each time it cosigns and keeps login records for up to 15 years.
What we didn’t compare, and why
Speed and sync time. Neither review includes performance tests, so no winner is named.
Android app quality. Only the existence of Electrum’s Android app is compared, not how well it works.
Sparrow vs Electrum: which one to pick
Read the full Sparrow review if you want a phrase that any BIP39 wallet can restore, plan to run Bitcoin Core yourself without adding an Electrum server, or want Tor without installing it separately. You accept that one developer maintains it with no company or support team, that no outside auditor has checked it, and that by default it talks to a random public server and sends exchange-rate, fee and update requests to outside services; the exchange rate and the update check can be switched off.
Read the full Electrum review if you want Lightning payments or Android, or prefer software from a company with two lead developers and releases signed by five builders. You accept a seed phrase that BIP39-only wallets cannot read, a Tor you have to run yourself, four security problems since 2018, one rated high severity, and frequent security updates you have to install yourself. If you already run your own Electrum server, both apps can connect to it, and the difference in what outside servers see largely disappears.
The other wallets we have reviewed are on the crypto wallets page.