Multi-sig, or multi-signature, is the requirement for two or more signatures on a transaction before it can be completed. Multi-sig is used in the Bitcoin and comparable electronic cryptocurrencies to boost security. A classic multi-sig would be set up as ‘M-of-N’, with M denoting the needed number of signatures or keys and N being the total number of keys involved. For example, a 2-of-3 multi-sig setup would require two signatures from a group of three keys that are responsible for the wallet. Multi-sig is similar in paper-based financial transactions and contractual agreements that require more than one signature, such as corporate checks that require two or more signatures, which have been around for decades. It has tremendous potential for decentralized escrow services and other financial constructs.
Multisig
Related terms
- Address A crypto address is a string of letters and numbers, like an account number, that identifies where coins should be sent on a specific blockchain.
- Cold Wallet A cold wallet is a crypto wallet that stores your private keys offline, usually on a hardware device, out of reach of most online attacks.
- Hot Wallet A hot wallet is a crypto wallet whose private keys are kept on an internet-connected device, such as a phone, computer or browser extension.
- Non-Custodial Wallet A non-custodial wallet is a crypto wallet where you, not a company, hold the private keys and recovery phrase that control your funds.
- Paper Wallet All you need to spend your Bitcoin is a private key, which you can even store on a paper wallet.