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A multisig (multi-signature) wallet can be one of the most valuable tools for crypto enthusiasts. However, many investors have never even heard of the term before. So, what is a multisig wallet? Explore our guide to discover what it is and to see if you should use one.
A multisig wallet is a special type of crypto wallet for securely storing cryptocurrency. You can only access the cryptocurrency when two or more signatures are entered together.
You can think of a multisig wallet as being somewhat like a multi-key secure deposit box. This style of box stores assets and can only be opened when multiple keys are inserted into multiple locks. The multisig wallet is essentially the digital version. The cryptocurrency is stored in a wallet, and transactions can only be made when multiple users enter their own unique signatures or keys.
Multisig wallets have been around since 2013, and they come in many forms. When you set up the wallet, you can decide exactly how many private keys are available and how many are needed to open the wallet. A common option is the "two-of-three" multisig. This style has three unique signatures, and any two of the three can be used to authenticate a transaction. Other common options include three-of-five wallets, two-of-two wallets and five-of-seven wallets.