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What Is a Multisig Wallet? Requiring Several Keys to Spend
A multisignature (multisig) wallet requires signatures from M out of N designated private keys before coins can be spent, so no single key or device can move the funds alone.
Key takeaways
- A 2-of-3 setup needs any two of three keys to sign.
- It protects against a single lost or stolen key and against one compromised device.
- It adds complexity: you must back up every key and the wallet's configuration.
- Bitcoin's standard M-of-N transactions are specified in BIP-11.
How it works
An ordinary address is controlled by one key. A multisig address is controlled by a set of N keys together with a rule that at least M of them must sign to spend. BIP-11 defines the standard M-of-N transaction form on Bitcoin, in which the output holds M and the list of N public keys, and the spender provides M valid signatures.
What it protects against
If one key is lost, a 2-of-3 wallet can still be spent with the other two. If one key is stolen, the thief cannot spend alone. Spreading the keys across different devices, places or people reduces the chance that a single failure or a single compromised device empties the wallet. Organisations also use it to require approval from more than one person.
What it costs
Multisig is harder to use. Each signer must keep a key safe, and you need enough information to rebuild the wallet, usually the set of public keys and the M-of-N rule, since losing that can make recovery difficult even with the keys. Transactions are larger, so fees are higher, and not every wallet or service supports sending to or from multisig addresses.
Choosing a setup
For personal holdings, 2-of-3 is a common balance between safety and convenience. Keep keys in separate locations, test a small recovery before you rely on it, and write down the configuration. Multisig is not required for everyone: for small balances a single well-protected key in a non-custodial wallet is simpler, and complexity itself can cause loss.
Example
A 2-of-3 wallet has keys on a phone, a hardware device and a paper backup in a safe. If the phone is lost, the hardware device and the paper backup can still sign together. A thief with only the phone cannot spend.
Put it into practice
Start by protecting a single key well
Before you consider multisig, secure your own keys. Scrypt Wallet recovers through the individual key for each coin and supports passkeys, so test your backup first.
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Last reviewed 2026-10-02 by the Scrypt Wallet team. The factual claims on this page, and where each comes from:
- BIP-11 defines standard M-of-N multisignature transactions on Bitcoin. [1]
- Multisignature requires more than one key to authorise a transaction. [2]
Sources
- BIP-11: M-of-N standard transactions · bitcoin/bips on GitHub · primary source
- Multisignature · Wikipedia · secondary source
Primary sources are protocol papers, specifications, source code or a project's own documentation; secondary sources are wikis and explainers. We checked each claim against the source text on the review date. Found an error? Tell us and we will correct it.
Frequently asked questions
Is multisig the same as a joint account?
It is similar in spirit, but enforced by cryptography. The coins can only move when the required number of keys sign.
What if I lose too many keys?
If fewer than M keys remain, the funds cannot be spent by anyone. Keep enough backups in separate places.
Does multisig remove all risk?
No. Setup mistakes, lost configuration data and compromised devices can still cause loss.
Written by the Scrypt Wallet team · Updated 2026-10-02. General education, not financial, tax or legal advice.