Multi-Signature (Multisig)

A multi-signature wallet is a cryptocurrency wallet that requires multiple private keys to authorize a transaction, implementing an M-of-N signature scheme where M signatures from a set of N authorized keys must approve each transaction before execution.

Common multisig configurations include 2-of-3 (any two of three key holders must sign), 3-of-5, or 5-of-7 arrangements, distributing control across multiple parties or devices to prevent single points of failure. Multisig wallets reduce risks from key theft, insider fraud, or individual key loss while maintaining operational flexibility through partial key distribution.

Institutional crypto custodians extensively use multisig as a core security control, often combining hardware security modules, geographically distributed key holders, and time-delayed transactions to achieve defense-in-depth. Treasury management DAOs implement multisig to require executive approval for fund movements. Multisig architectures provide superior security compared to single-key hot wallets but introduce coordination complexity and potential delays in transaction execution. Advanced implementations use threshold signature schemes and multi-party computation to achieve similar security properties with improved efficiency and privacy.