BMP and ICO are close relatives
The ICO format was designed around the Windows bitmap. A classic icon file is a directory followed by device independent bitmaps, the same pixel layout as a BMP without the file header, plus a one bit AND mask that tells Windows which pixels are see-through. Because of that history, BMP is the format people reach for when they build icons the old-fashioned way, in Paint or in a resource editor, and it is common to find application icon artwork stored as 32, 48 or 256 pixel BMP files.
What this converter does differently from a 1995 icon editor
Instead of writing bitmap data with a mask, the converter draws your BMP onto a canvas at 16, 32, 48, 64 and 256 pixels, encodes each size as a PNG and stores those PNGs inside the .ico container. Windows has accepted PNG-compressed icon entries since Vista, and every current browser reads them. The directory records still declare 32 bits per pixel and a size of 0 for the 256 entry, which is the format's way of saying 256, so the file is a fully standard icon. The practical difference is size: a 256 pixel entry as raw 32 bit bitmap data would be 256 KB before the mask, while the PNG version of a flat logo is usually a few kilobytes.
Transparency: what BMP can and cannot carry
Most BMP files are 24 bit and fully opaque. A 32 bit BMP can hold an alpha channel, but only with the newer header versions, and browsers vary in whether they honour it; the safe assumption is that your BMP will decode as a solid rectangle. That means the favicon will have whatever background colour the bitmap has, usually white or the editor default. If the artwork was drawn on a magenta or green key colour, as old icon artwork often was, that colour will show in the tab. Convert the BMP to PNG, cut the background out with the background remover, and then convert the PNG to ICO for a floating icon.
A worked example from a Paint file
A 256 by 256 logo saved from Paint as a 24 bit BMP is exactly 196 KB plus a 54 byte header, regardless of content, because BMP stores every pixel uncompressed. After conversion the ICO is typically 20 to 50 KB for a flat colour logo and up to 150 KB for a photographic one. That is a bigger file than a bare PNG favicon would be, since the container holds five images, but it is still a fraction of the source. Figures are typical, not guaranteed; PNG size tracks the amount of detail.
Sizing and the square rule
The canvas scales the BMP to fill each square entry, so a rectangular bitmap will be distorted rather than letterboxed. Crop to a square first with the crop tool. Because BMP files created for icon work are often already 32 or 48 pixels, the 64 and 256 entries will be upscaled and visibly soft in large icon views; if a bigger version of the artwork exists anywhere, start from that instead.
Where the result is useful
The .ico works as a website favicon, as a Windows shortcut or folder icon, and as the icon resource for a small application. Everything runs on your device with nothing uploaded, and each BMP produces its own download. For a complete web icon set with PNG variants for phones, use the favicon generator instead of converting size by size.