Bitcoin payments are gaining more popularity, especially in the business to consumer (B2C) world where payment security and protection from fluctuating currency are the biggest drivers.

Large retailers like Dell and Microsoft are accepting Bitcoin as a payment method.

The speed at which Bitcoin payments take place and the cost savings compared to traditional wire transfers and PayPal transactions have put more confidence in the consumers to use a Bitcoin payment wallet.

According to Coin Telegraph, the Bitcoin B2B payments are also on the rise.

There are several Bitcoin wallets out there and how does one go about finding the right provider? After all, each provider boasts their payment wallet is the most secure.

When you look under the security hood, features such as 2-of-3 Multi Signature and HD Wallet may provide an insight. Other features to look out for are support for multi-platform, user controls coins, reputation, online user reviews and feedback.


Here is a head-to-head comparison of vs XAPO:

2-of-3 Multi Signature

All transactions made with a robust Bitcoin wallet must be multi-signature transactions by default. This gives users an extra layer of protection against theft and hacking because wallet transactions require 2-keys to create a valid transaction. One key is signed by the user, on their device (web or mobile) and another key is signed by the wallet provider’s server. Before the transaction is authorized it is checked against the users custom security rules, which can, for example, limit signing to dealings which the user has authenticated using 2-factor authentication.

Verdict: All transactions made with wallet are multi-signature transactions by default. Since XAPO is a custodial wallet, transactions are signed on XAPO’s servers and not on the user’s device, and therefore users do not gain the benefit of multi-signature security.

BTC 1 – XAPO 0


HD Wallet

There are many benefits to using HD wallets for making Bitcoin transactions, primarily it enables users to create a secure offline backup of their wallet, and it also helps protect user privacy. Older wallets that are non-HD have a unique private key for each bitcoin address. This makes creating new addresses for each transaction tedious because it means that you would need to also create a new wallet backup for the newly generated bitcoin address and its corresponding private key. Wallets that are Hierarchical Deterministic (HD) wallets have one a set of private keys which are used to generate an unlimited amount of Bitcoin addresses without needing to create a new backup, ever. The only backup that is required is the one when the wallet was initially created, and using that backup, all bitcoins and all addresses can be regenerated, and the wallet (and any funds stored on it) can be fully recovered.

Because creating new bitcoin addresses becomes easier using HD wallets, it discourages address re-use for transactions. It has been known that re-using bitcoin addresses reduce user privacy, because all transactions are public on the blockchain, and re-used addresses are easier to link or group together into clusters.

Verdict: HD wallet creates a wallet backup for you, that you can store securely offline and use it to restore your wallet and its funds at any point in time, even if servers are offline! XAPO wallet does not give you an offline HD backup, so if XAPO servers go down, you will not have access your funds.

BTC 2 – XAPO 0


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Users Controls Coins

Wallets are generally split into two camps: a) Wallets that allow users to own and control their own bitcoin, or b) services which manage the bitcoin for users, similar to how a traditional bank works. Some wallets allow users to control their own bitcoin, so even if the server is not online, or even if the servers are destroyed in a meteor crash, users can still have access to their Bitcoin. This is unlike bank-like wallets which control and store the bitcoin for the user, and therefore they require bank-grade security. As we know even banks have security issues from time to time and this is why it’s common in the Bitcoin world to hear of large scale bank-robbery like hacks. Hence using a wallet that allows you to control your own bitcoin instead of giving up that control to service providers is important.

Verdict: BTC wallet allows users to control their own bitcoin whereas XAPO manages the bitcoin for its users.

BTC 3 – XAPO 0



When choosing a Bitcoin wallet reputation also plays a big part. Bitcoin wallet providers such as have had many issues in the past with downtime. Competitors such as Bitgo have had a downfall in reputation due to a customer of theirs (Bitfinex) getting hacked for $70m even though they used Bitgo security. Airbitz and Breadwallet are known to be smaller wallets while larger companies such as Coinbase, Xapo, and Circle all maintain a fairly good reputation.

Verdict: Tie

BTC 4 – XAPO 1

Winner of this side-by-side is BTC.

Conclusion and Takeaway

When considering between Bitcoin wallet providers choose one with a good reputation and track record. Look for a wallet that is robust, secure and at the same time provides some flexibility to its users by offering their services on multiple platforms and allowing users to control the coins. It is a great idea to read online reviews and user feedback of your shortlisted wallets before deciding on one.