Features of wallets to be called reputable wallets

[Oshosondy]

The first wallet which is bitcoin core was created in a way to fulfill how other wallets should be created aside from being full client that SPV wallets can not support but have to depend and connect to third party server to sychronize the wallet with the blockchain. Bitcoin core connects and runs from nodes to nodes. This makes full client wallets to be the best privacy wallet. Another good wallet that serves for privacy purpose in a way it coinjoins transactions and make bitcoin transactions mixed with other ones to avoid tracking of addresses is called wasabi wallet, this wallet increase privacy. Those two wallets above are very important and their functions should be known, but the reason people are not using bitcoin core is the over 300 gigabyte of data needed to download the full blockchain while people prefer not to run the pruned version but the full client. I will focus more on simplified payment verification (SPV) wallets because they are the ones used by people commonly today.

SPV wallets
This are not full client that run from nodes to nodes, but depends on central server to synchronize the blockchain, they are the common wallets we are using today. When bitcoin and crypto was at their earlier age, most SPV wallets are having the best feature of wallets, but later, there are many more modifications that makes many wallets not to be good, examples are some open source wallets that gone close source. Which is the reason I have to list the features good wallets should have.

1. Good wallets should be open source wallets, if close source, you will not know the code used to make the wallet working, you will not know if the wallet have codes that can steal from you or that can attack your device. The close source can be good today, but later can have malware inputted.

2. Self custody, these are noncustodial wallets, some wallet are not, they are custodial, it means you do not have the private key, it mean you do not have complete control over your coins. There are many cases the third party that gives custodial wallet will block someone's account in a way the person will not be able to access it. Also the third party have the private key which can be used to control your coin.

3. Good wallet should support segwit addresses, otherwise you will waste funds paying high fee if using legacy wallets that do not support segwit. There are many people wasting bitcoin on fee because they are using legacy wallet that do not support segwit. Any wallet that do not uograde to segwit should not be used.

4. Coin control, it may not be necessary, but also useful as you can select the address you want to spend from.

5. Wallets that support RBF, it means replace by fee, latest wallets should support this to help in case of stuck transactiyon in a way the fee will be increased to make the transaction get confirmed in time. On some wallets that do not support RBF, the person will have no option than to use CPFP which the fee that will be needed will be higher (multiply by two), may not be possible if the receiver can not spend unconfirmed transactions also if the sender do not have bitcoin change address while sending.

Ignorance makes people to use a wallet that pays high fee when there are good wallets like electrum that support segwit. You can use any wallet you like, but know that not all wallet that people say are reputable are reputable, many are close source, many do not support segwit, most do not support RBFwhich are very important.

[jackg]

I think Satoshi intended for spv clients to be a thing anyway and they're well serviced by the network (clients like schieldbach's wallet for Android) look hard to spoof - if they download with the genesis block and request further blocks from there with a hash they display to the user (it's quite easy to verify).

Satoshi's whitepaper also mentions bitcoin is decentralised (decentralised networks have pruned or spv clients) - distributed networks however don't.

[Pmalek]

3. Good wallet should support segwit addresses, otherwise you will waste funds paying high fee if using legacy wallets that do not support segwit.

More precisely, exchanges, casinos, and other crypto platforms need to offer withdrawal support for Native SegWit addresses (bech32). Most services already support Nested SegWit, but Native SegWit allows users to save even more on transaction fees.

These two sources offer a nice overview of wallets and exchanges that fully support Native SegWit addresses. The only problem is that they are probably not updated regularly.

https://en.bitcoin.it/wiki/Bech32_adoption
https://whensegwit.com/

[Charles-Tim]

3. Good wallet should support segwit addresses, otherwise you will waste funds paying high fee if using legacy wallets that do not support segwit.

More precisely, exchanges, casinos, and other crypto platforms need to offer withdrawal support for Native SegWit addresses (bech32). Most services already support Nested SegWit, but Native SegWit allows users to save even more on transaction fees.

You are right, native segwit have the lowest fee, while the nexted segwit is still good. If native segwit can save 42% fee, nested segwit will be able to save 35% or more fee while legacy should be forbidden as it presents only the raw trasaction to calculate the fee. There are still some wallets that do not support nested segwit and native segwit but legacy addresses, a good example is atomic wallet, although its seed phrase has derivation path for both segwit, but not accessible on the wallet as legacy addresses are the only addresses accessible on the wallet, this makes many people using the wallet to pay too high on fee.

[tranthidung]

the reason people are not using bitcoin core is the over 300 gigabyte of data needed to download the full blockchain while people prefer not to run the pruned version but the full client.

It is not only about big storage space requirement for a full node and the cons of prune node, but also about the decreased capacity of your computer when you start it and let your full node runs. The full node operations do slow down the general performance of your computer.

I tried it in the past and above is my experience. So except only when you are using a superb strong computer, you will get inconvenience if you are working on the same computer that stores and runs the full node.

I will focus more on simple payment verification (SPV) wallets because they are the ones used by people commonly today.

SPV ~ Simplified payment verification. Simplified, not simple. They are lightweight client wallet.

Some nodes maintain only a subset of the blockchain and verify transactions using a method called simplified payment verification, or SPV. These nodes are known as SPV nodes or lightweight nodes.

[1] https://en.wikipedia.org/wiki/Bitcoin
[2] Mastering bitcoin - Chapter 5, The Bitcoin network

[khaled0111]

On some wallets that do not support RBF, the person will have no option than to use CPFP which the fee that will be needed will be higher (multiply by two)

The bolded part (emphasis mine) is not totally accurate.
Although it's true that, most of the time, opting for CPFP over rbf means paying more in fees, saying that it will cost 2x the original fee is not totally accurate.
The fee you have to set for the child transaction in order to accelerate its ancestor/s depends on few factors. Basically, it depends on the size of all involved transactions, the fees the ancestors are already paying and how much you need to add to incentivize miners to prioritize your transactions.

[Oshosondy]

The fee you have to set for the child transaction in order to accelerate its ancestor/s depends on few factors. Basically, it depends on the size of all involved transactions, the fees the ancestors are already paying and how much you need to add to incentivize miners to prioritize your transactions.

Total agree with you, just to show how RBF can save more fee to be paid than CPFP. Two transactions will be paid for in CPFP unlike RBF. But part of the fee paid are the low fee which not get the transaction confirmed and also new fee in addition that will get the two transaction confirmed at ones.

[pooya87]

3. Good wallet should support segwit addresses, otherwise you will waste funds paying high fee if using legacy wallets that do not support segwit.

More precisely, exchanges, casinos, and other crypto platforms need to offer withdrawal support for Native SegWit addresses (bech32). Most services already support Nested SegWit, but Native SegWit allows users to save even more on transaction fees.

I find it a bit absurd to single out SegWit like this (just because it had some drama circling it).
Generally speaking a reputable wallet would have any feature that bitcoin has to offer, that includes multi-signature (P2SH added years ago), supports various bitcoin scripts including locktime OPs, supports SegWit, supports any new feature that is added to bitcoin within reasonable time. and a lot more.
If any wallet (or services) don't support bech32 addresses it is like if they weren't supporting P2SH addresses (starting with 3) and there is no point in using any of them.