How to Use Electrum Wallet? Seed Phrase, Servers, and Sending/Receiving

Crypto Basics

07 October 2026

Electrum has one obvious difference from most wallets: it is desktop-first, servers are run by third parties, and when restoring from a seed phrase you may run into problems like "the wallet is empty." These three points match the servers, seed phrase, and sending/receiving mentioned in the title.

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Downloading and Creating a Wallet

Download Electrum only from the official website electrum.org. There are no exceptions. Installers distributed by third-party sites may have been replaced, and once your seed phrase is generated it could be exposed to a malicious version.

When creating a wallet, choose Standard wallet, then choose Create a new seed. Electrum will show a set of 12 words as your seed phrase. Write these words down in order on paper. Do not take a screenshot, do not save them in a notes app, and do not send them to yourself. The seed phrase is the only way to restore your wallet. Anyone who gets it can take all your bitcoin.

The next step is to set a password for your wallet file. This password only encrypts the wallet file on your computer. It is not the same as the seed phrase. If you forget the password, you can rebuild the wallet using the seed phrase. If you lose the seed phrase, the password cannot save you.

What Is a Server and Why It Affects You

Electrum does not download the entire Bitcoin blockchain. It connects to a group of servers run by third parties and gets block headers and transaction information related to your addresses from those servers.

This means two things. First, the balance and transaction history you see after starting the wallet depend on whether the currently connected server is working properly. If the server fails to sync or responds slowly, switching to another server usually solves the problem. You can see the connection status in the bottom-right corner of the interface. Click it to manually choose another server.

Second, the server can see which addresses you are querying. This does not let the server take your coins, because your private keys always stay on your local device. But it does mean your addresses and transaction history are not completely private from the server operator. If this matters to you, Electrum supports connecting through Tor, and you can also run your own Electrum server to remove reliance on third parties. For most ordinary use, automatic server selection is good enough.

Receiving Bitcoin

Click the Receive tab. Electrum will show a Bitcoin address and a QR code. Send this address to the payer, or show the QR code when the other party scans it.

Electrum generates a new address every time you open Receive. This is by design. It reduces the chance that outsiders can link all your transactions together through on-chain analysis. You do not need to manage these addresses. Bitcoin received by old addresses will still appear in your balance.

After copying an address, always check the first and last few characters. There is a common type of malware that replaces cryptocurrency addresses in the clipboard. If the payer copies the address you sent and it gets replaced with an attacker's address, the bitcoin will go directly into the attacker's control. The most direct way to prevent this is to have the other party read aloud the first and last few characters of the address before sending.

After receiving a payment, the transaction will first show as "unconfirmed." Bitcoin confirmation time is usually between 10 minutes and 1 hour, and it can be longer when the network is congested. In Electrum's History tab, you can see the transaction status change from Unconfirmed to Confirmed.

Sending Bitcoin

Click the Send tab. Paste the receiving address in the Pay to field and enter the amount in the Amount field. Electrum's default unit is mBTC (millibitcoin). Many people are used to pricing in BTC, so you can change the base unit to BTC in the settings to avoid misreading the amount by one decimal place.

You decide the fee. Electrum provides a slider or manual input. The higher the fee, the faster miners usually confirm the transaction. When the network is not congested, a lower fee can still be confirmed within a reasonable time. When it is congested, a low-fee transaction may stay in the mempool for a long time. Electrum supports RBF (Replace-By-Fee), which means you can raise the fee to speed up a transaction before it is confirmed.

Before sending, check three things in the popup window: the receiving address, the amount, and the fee. If the address is wrong, the bitcoin usually cannot be recovered. Bitcoin transactions are irreversible, and there is no customer service to undo them. For large amounts, it is recommended to send a small test transaction first and confirm the other party can receive it before continuing.

After the transaction is broadcast, you can see its status in History. If it remains unconfirmed for a long time, first check whether the fee is too low, and then decide whether to use RBF to speed it up.

Seed Phrase Recovery: What to Do If the Wallet Is Empty

When restoring a wallet with a seed phrase, Electrum may show a balance of zero even though you know there is money in it. The most common reason is a mismatch in address type or derivation path.

Bitcoin addresses come in several formats: Legacy (starting with 1), P2SH-SegWit (starting with 3), and Native SegWit (starting with bc1q). If your original wallet used Native SegWit but you selected Legacy during recovery, Electrum will derive completely different addresses, so naturally you will not see the balance.

The order of operations during recovery: after entering the seed phrase, Electrum will ask you to choose a script type. If you are not sure what type the original wallet used, try native segwit first. If no balance appears, delete this Electrum wallet file or create a new wallet with a different name, then go through the recovery process again and this time choose legacy. Only after trying both should you consider other possibilities.

There is another easily overlooked situation: if you used a BIP39 passphrase, Electrum will ask for this passphrase during recovery. Leaving it empty and entering it incorrectly will produce two completely different wallets. If you are not sure whether you set one, try both.

Some Practical Judgments

Electrum only supports Bitcoin. It does not manage Ethereum, USDT, or other on-chain assets. If you need to manage multiple coins, Electrum is not the right tool.

If the payer chooses the wrong network when transferring, for example sending bitcoin to an Electrum address but using another chain, the coins will not enter your Electrum wallet. Bitcoin mainnet addresses start with 1, 3, or bc1. Address formats on other chains are different. Before receiving a payment, confirm that the network the other party is using is Bitcoin Mainnet.

Electrum's wallet files are stored on your local computer. On Windows they are in %APPDATA%\Electrum\wallets. On macOS and Linux they are under ~/.electrum. If your computer is damaged and you have lost your seed phrase, your funds cannot be recovered. The seed phrase is your only backup.

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