Multisig wallet
Also called: multisignature wallet · multi-sig · Safe wallet
Definition
A multisig wallet is a crypto wallet that needs signatures from several separate keys, such as 2 of 3, before any transaction can be sent, so no single lost or stolen key can move the funds.
This entry is shown in English.
How Multisig wallet works
A multisig is described as M-of-N: N keys exist and M of them must sign. A 2-of-3 setup can survive one lost key and still blocks a thief who steals one key. On Bitcoin, multisig is built into the script system. On Ethereum and EVM chains, it is usually a smart contract wallet, with Safe as a widely used example.
Multisigs are standard for DAO treasuries, company funds and exchange cold storage. Individuals use them for large savings, often with keys on different hardware wallets stored in different places.
The trade-off is complexity. You must back up every key and, for Bitcoin, the wallet configuration that describes the setup. Each transaction takes more steps, and on EVM chains you rely on the multisig contract being secure.
Example
Suppose a small team keeps 120,000 USDC in a 2-of-3 Safe. Each of three founders holds one key on a separate hardware wallet. One founder's laptop is compromised and the attacker proposes sending everything to their address. The other two founders see the proposal, refuse to sign, and move the funds to a new Safe with a replacement key. With a single-key wallet, the 120,000 USDC would already be gone.
Common mistakes
- Storing two of the three keys in the same place, which turns 2-of-3 into a single point of failure.
- Backing up the keys but not the Bitcoin wallet configuration needed to rebuild the multisig.
- Signing a multisig transaction without checking what the other signer proposed.
Learn and practise
FAQ
Is a multisig wallet worth it for individuals?
For large long-term holdings it can be, because it removes single points of failure. For small amounts the extra complexity is often not worth it.
What happens if one multisig key is lost?
In an M-of-N setup, you can still sign with the remaining keys as long as you have at least M. Replace the lost key soon by moving funds to a new setup.