What is Multisig (Multisignature) Wallet?
Crypto Glossary Definition
A wallet that requires more than one key to authorize a transaction.
Why Multisig (Multisignature) Wallet Matters
A multisig wallet requires more than one private key to approve a transaction (e.g. 2-of-3 signers), so no single compromised key can move funds alone. It's the standard security setup for project treasuries, DAOs, and anyone who wants to remove single points of failure from custody.
Multisig (Multisignature) Wallet in Practice
A DAO managing a multi-million-dollar community treasury doesn't want any single team member able to unilaterally move funds, whether due to a compromised laptop, a rogue insider, or simple human error. Instead, it sets up a multisig wallet configured as 3-of-5, meaning five designated core contributors each hold one private key, and any transaction requires at least three of those five to individually review and sign off before it executes on-chain. When the DAO wants to pay a contractor, one member drafts and proposes the transaction, then shares it with the others through the multisig interface; two more members review the destination address and amount before adding their own signatures, and only once the third signature is added does the transaction actually broadcast and move funds. If one signer's laptop were compromised by malware, the attacker would still need at least two more independent signatures from other keyholders located elsewhere before any funds could be stolen, making a successful attack dramatically harder than it would be against a single-key wallet. The same structure scales down to individual use too — a person might set up a 2-of-3 personal multisig with keys stored on separate hardware devices in different physical locations, ensuring that losing or having one device compromised doesn't mean losing control over their entire holdings.
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