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Electrum is a popular software wallet that works by connecting to a dedicated server. These servers receive a hash of the Bitcoin address in the wallet and reply with transaction information. Electrum wallets are fast and have few resources, but by default, it connects to these servers and can easily monitor users. In addition to Electrum, some other software uses public Electrum servers. By 2019, it is a faster and better alternative to BIP37.

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In the hardware wallet security at the same time, but also enjoy the convenience of the software wallet, which is really good. The problem is that usually only one or two software wallets are compatible per hardware wallet. For example, Trezor only supports software wallet Electrum. They can't connect Trezor to bitcoin core wallets or any other software they want to connect to.