TLDR; don’t use them.
All Bitcoin addresses have a public address and a private key for spending them. To keep your wallet safe, you have to either write the seed of your wallet down or keep backups of your wallet and its keys.
Keeping backups safe is a hard task on itself. What happens if your backups are stolen? You might loose all of your money. Is there any solution for this? Some people believe brain wallets are the solution.
Brain wallets are a type of Bitcoin wallets, where you don’t have to take backups of them. You don’t have to keep a digital file safe. Nothing. They are just working with a single password/pass-phrase. Whenever you want to work with your wallet, you just launch them and enter your master password in them. Then based on that password, they create your addresses, show you your balance, allow you to spend from them, etc. You can see one of them at https://brainwallet.io.
So should you use them since they seem to be ultra secure? No. They have a big problem and that is the human working with them. Since they work with a password that the user has to memorize, users tend to use passwords that they are able to memorize. These passwords are not secure.
You might think that I can remember it, but those passwords are guessable. Most humans can’t come with a password that is not related to them, be multiple words none of them related to each other, not used any where else, have enough entropy, etc. People usually use passwords that they have used on some other places, or maybe at most change a few characters of those passwords. They might mix multiple numbers related to them or their friends or parents or children.
In a nutshell, humans are not a good source of entropy. That means passwords that we come up with, are not good enough. Thieves can use lots of automation tools and cloud powered servers, and databases of hijacked passwords to come up with different passwords, use them to generate brain wallets, and check the balance, and if they got a match, they easily transfer those Bitcoins to their own secure wallet. Easy money for them, without ever being caught. Worst, the legitimate owner wouldn’t know this until the next time they check their balance.
So, don’t use Brain Wallets. Current best practice is to keep a hard copy backup of your wallet seed phrase (usually a 12 or 24-word phrase), written on a piece of paper kept somewhere safe.
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