Choosing Your Lightning Wallet: Unveiling the Top 14 Portals to the Internet of Money
The article contains the 14 best Bitcoin/Lightning hot wallets in terms of; convenience, Privacy, and degree of control. Pick one and use it today to avoid potential high bitcoin fees in the future.
Today’s Bitcoin pizza is the Quattro Formaggi: Tomato sauce (or white sauce), Mozzarella cheese, Gorgonzola cheese, Fontina cheese, Parmesan cheese (grated), Optional: Fresh herbs. Bon Appétit!
The Lightning Network is a groundbreaking technology that is revolutionizing the way we use money online. Imagine being able to send and receive Bitcoin instantly, with minimal fees and enhanced privacy. Sounds amazing, right?! Let's take a closer look at the top 14 hot Bitcoin-Lightning wallets and how to choose your favourite.
⚠️ CAUTION: All lightning wallets are hot wallets meaning your keys are encrypted and stored on devices that are always connected to the internet. They are very secure but not as secure as bitcoin cold wallets. If a large amount of money accumulates in your lightning wallets, transfer your funds to a cold wallet. You can read my article on the 7 and only hardware wallets that I could ever recommend here.
Before we jump in, let's clear up a few things. Ownership of money in Bitcoin is determined by whether or not you have the private keys thus the aphorism:
“Your keys? Your coins. Not your keys? Not your coins” -Andreas M. Antonopoulos
Lightning wallets come in three flavors: fully-Sovereign, custodial, and hybrid wallets. Fully-sovereign wallets give you complete control over your keys (funds) and are perfect for those who prioritize privacy and self-sovereignty. However, these wallets require dedicated hardware and some technical know-how. On the other hand, custodial wallets offer convenience and ease of use, similar to a bank where the wallet's operating company manages your funds and hides all the complexity from you. This sounds great to newbies, but it doesn't appeal to true bitcoiners, because you know… not your keys, not your cheese!
Finally, we have hybrid wallets, which strike a balance between control, convenience, and privacy.
Which flavor should I start with?
🏦 Beginner: You have never used bitcoin before, go for a custodial wallet
☯️ Intermediate: You have used a bitcoin wallet at least once, go for a hybrid
👑 Expert: You used a hybrid wallet and you want to take it to the next level, go ahead and set up a fully-Sovereign Lightning wallet like a true bitcoin King/Queen
If you don’t have any bitcoin yet to try out this technology I would suggest that you sign up to Coinbits if you’re in the US and take advantage of their Round-Ups feature. Coinbits lets you accumulate bitcoin by rounding up your everyday purchases to the nearest dollar, Using my referral links and codes helps me continue my mission in providing free and open-source bitcoin education for the masses. Thanks!
Now, let's explore some of the top Lightning wallets in each category and find the perfect fit for your needs.
🏦 Custodial Wallets
These wallets offer quick and convenient transactions, making them perfect for everyday use. However, remember that by depositing Bitcoin into a custodial wallet, you're handing over ownership to the wallet's operating company. While this means you can enjoy lightning-fast transactions without a complicated setup, it also means the company can exert control over your funds. They can cease and freeze your account whenever they please, so don’t hold any serious amount of money in custodial wallets. The reason why they’re so popular in bitcoin is because people can easily connect them to their Nostr accounts (a decentralised social media protocol built by bitcoiners).
Here are some famous custodial Lightning wallets:
1. Strike
Prepare to be impressed by Strike's capabilities, this exceptional Lightning wallet not only lets you send and receive Bitcoin but also allows you to seamlessly zap government-issued currencies like the US dollar or the Philippine peso. No more fees or lengthy conversion processes, just connect your bank account to Strike and send cross-border payments to your friends on the other side of the world instantly and denominated in their local currency. I won’t get into the technical details of how this can be achieved but you should definitely study it because this is the future of cross-border payments IMO. Unfortunately, Strike is not yet available every, but keep an eye out for future expansions. The downside, of course, is that you have to go through a KYC process, which encroaches upon your financial privacy.
2. Blink
If you're looking for lightning-fast bitcoin and fiat-denominated payments, Blink is the wallet for you. It enables you to send and receive digital national currencies backed by Bitcoin, known as Stablesats, with remarkable speed and efficiency. Say goodbye to traditional banking hassles and enjoy super-sonic transactions on the Lightning Network.
3. Wallet of Satoshi
This wallet is famous for its simplicity. I always use it to introduce my family and friends to bitcoin.
“Hey, have you used bitcoin before? No? okay, download Wallet of Satoshi, please”.
4. Zebedee
Zebedee is a wallet that caters specifically to gamers. Set up your gaming tag, design your avatar, and connect it to your favorite lightning-enabled video game like CS:GO. You can also connect it to a discord server and use shortcut commands to interact with it.
5. LightningTipBot
If you're on Telegram, you can also try out @LightningTipBot, a bot-like wallet that allows you to send and receive Lightning payments effortlessly to or from other Telegram users. We like to use it in Barqnet, our Arabic bitcoin community group.
☯️ Hybrid Wallets
Now, let's switch gears and talk about hybrid Bitcoin-Lightning wallets. If you're a serious Bitcoin user or simply want complete control over your funds, it's advisable to consider a hybrid Bitcoin-Lightning hot wallet. These wallets offer the best of both worlds, giving you control over your keys while minimizing the technical complexities involved. There are some minuscule trade-offs involved in the design of these wallets, such as the required trust in the wallet operator during the channel-opening process. However, these trade-offs are well worth it since any attempt by the wallet operator to cheat you effectively results in mutually-assured damage to their market reputation. I would highly encourage you to use one of these since depositing your Bitcoin into one today will automatically give you self-sovereign liquidity channels that can save you fees in case Bitcoin’s onchain fees skyrocket again.
1. Phoenix
If you're looking for a user-friendly wallet that puts you in the driver's seat, Phoenix is the way to go. It gives you full control over your keys and lets you send and receive Bitcoin seamlessly, without knowing which network (Bitcoin or Lightning) you’re actually using. It manages all the complexity of the lightning network like opening channels, managing liquidity, and funky bitcoin shenanigans behind the scenes, saving you time and hassle. The only downside? Privacy could be (and will soon be) improved, but overall, Phoenix is a winner. Next week, we will do a quick tutorial on how to use it professionally. Stay tuned!
2. Breez
Get ready for a wallet that does more than just handle Bitcoin transactions. Breez transforms into a versatile platform for online payments, selling goods, and even accounting. It even includes a podcast platform where you can support your favorite content creators with micro-payments at a rate that you can set (i.e 10 Sats every minute). The only trade-off? Breez can be a bit resource-intensive and slow due to its lightweight Bitcoin and full Lightning nodes.
3. Bitkit
Sleek, elegant, and secure—Bitkit is a wallet that emphasizes ease of use, privacy, and security. While it's currently under development, it's a great option for those who appreciate a visually appealing interface and value their funds' safety. Engage in immediate financial communication and even add profiles of friends to your wallet.
4. Blixt
Flexibility and privacy are the hallmarks of Blixt. If you're a tech-savvy individual, you'll appreciate the advanced features and high level of privacy this wallet offers. It's a solid choice for those who want full control over their funds and value their online privacy.
5. Muun
Looking for a Bitcoin wallet that supports Lightning payments without a complex setup process? Muun is here to help. With good privacy features (Taproot enabled) and the ability to handle both bitcoin and lightning transactions seamlessly, Muun is an excellent choice for beginners. Just keep in mind Muun is operated natively on the main bitcoin network so fees may increase over time due to its reliance on a feature called ‘Submarine Swaps’.
👑 Fully-Sovereign Wallets
Are you running a node? Do your part, friend. Running a Bitcoin node not only allows you to own a fully-Sovereign lightning wallet and experiment with bleeding-edge Bitcoin technology, But it also gives you the maximum privacy and sovereignty over your funds, contributes to the decentralisation of bitcoin, and allows you to vote over the fate of the network as a whole as the saying goes:
Not your node? Not your rules.
I honestly find it difficult to call someone a bitcoin maxi if they’re not running a full Bitcoin/Lightning node. To set up a full node, you can either purchase a mini PC like a Fujitsu Esprimo q920 (Core i5, 8GB ram), a 1TB SSD hard drive (they cost around $200), or can rely on a cloud service such as Voltage for convenience ($26.99 a month). Be aware that running a node on a cloud service does not add to the decentralisation of Bitcoin and Lightning.
You will then need to install a “Helper” software such as Umbrel, Mynode, Start9, or Citadel on your node. These helpers come with app stores that contain useful Bitcoin and Lightning wallets and applications and provide you with a coding-free user-friendly environment.
The 4 remaining wallets in this article are actually Lightning Network protocol implementations which are: LND, LDK, Core Lightning, and Éclaire. Choose one depending on your preferences by downloading their respective applications from your helper’s app store. I would try to choose low-key implementations such as Core-Lightning over a famous one like LND just to push interoperability between implementations and increase the diversity of the Bitcoin ecosystem.
You can then start opening up liquidity channels with other nodes on the network. We haven’t covered liquidity channels extensively yet, but in short, these are your lightning wallets' pipelines through which your payments can be routed and received to and from other people in a self-custodial manner. In order to send payments, you need to commit a portion of your bitcoin sitting on your node’s hot wallet to a lightning channel that you will open with another peer on the network. In order to receive payments, you need to find a peer who’s willing to commit a portion of their bitcoin to a lightning channel that they will open with you, which is the difficult part because let’s be honest, who wants to commit liquidity to a noobie like you? Actually plenty of nice people!
Bitcoin is for enemies. Lightning is for friends.
Bitcoiners on Plebnet, Nostr, Twitter, or any online platform can help you establish what we refer to as an 'inbound liquidity' channel, enabling you to receive bitcoin on the Lightning Network. While your connection with your channel partner is entirely trustless, it's important to connect with liquid and reliable peers and to also make an effort to remain online and effectively manage your liquidity channels to ensure that both parties can benefit from the partnership. Include your channel partner's contact details and stay in touch with them through messaging apps. Lightning offers an excellent opportunity to socialize and build long-lasting relationships with bitcoiners all over the world :)
Avoid opening just a single channel at a time. Utilize liquidity swaps on Lightning+ to collaborate with two to five partners, enabling you to establish channels among yourselves and form a triangle or a pentagon. This configuration ensures that each person has both an outbound liquidity channel for sending payments and an inbound liquidity channel for receiving payments.
You can also purchase inbound liquidity from liquidity markets such as Magma by Amboss, Pool by LND, Liquidity Ads by Core-Lightning, and Flow by Voltage.
Finally, you will need to manage liquidity channels effectively using a specialized application such as ThunderHub, Lightning Terminal, Balance of Satoshis, or Ride the Lightning. You can download these applications from your helper's app store. Additionally, you have the flexibility to control your liquidity channels directly from your phone by connecting your node to Zeus. Some liquidity managers such as Terminal allow you to ‘auto-pilot’ the allocation of liquidity in your channels.
In advanced stages, you can earn annual returns on the bitcoin stored on your node by managing liquidity in a way that allows other individuals and businesses to pass payments through your channels. More on that next time 😉
Conclusion
Remember, it's always a good idea to try out multiple wallets and find the one that suits your needs and preferences the best. By diversifying your wallet usage, you can explore different features and user experiences. And if you're concerned about rising Bitcoin network fees, using a wallet like Phoenix can prepare you for future increases.
The Lightning Network is transforming the way we conduct Bitcoin transactions. With its instant, cheap, and secure payment capabilities, it opens up a world of possibilities for local and international trade. Whether you choose a non-custodial, custodial, or hybrid Lightning wallet, make sure it aligns with your preferences and goals. Embrace the Internet of Money and experience the power of lightning-fast Bitcoin transactions today!
To support my work, you can sign up to Coinbits if you’re in the US or Relai if you’re in Europe (For Relai, use the code: BAMSKI for discounts).