Multisignature (Multisig)

Multisig setups distribute signing authority across separate keys instead of trusting one device or person, so no single compromised key, lost device, or dishonest insider can move funds alone.

Two implementations dominate. On Bitcoin, multisig is built into the scripting language: an M-of-N rule is encoded directly into a P2SH or P2WSH address, and wallets like Electrum or Sparrow coordinate the partially signed transaction until enough signatures are collected before it broadcasts. On Ethereum and other smart-contract chains, a multisig is a deployed smart contract that stores the list of owners and the signature threshold on-chain; Safe (formerly Gnosis Safe) is the best-known example and now secures well over $100 billion in assets across dozens of networks.

Common configurations include:

• 2-of-3, popular with individuals and small teams who split keys across a hardware wallet, a phone, and a backup device
• 3-of-5 or 4-of-7, typical for DAO treasuries and company funds, with Uniswap's roughly $2 billion treasury a well-known example of a larger threshold in practice
• 2-of-2 escrow arrangements, where a buyer and seller must both sign, sometimes backed by a third arbitrator key held in reserve

The trade-off is coordination: transactions take longer to approve, on-chain multisig can cost more gas than a single-signer transfer, and if too many signers lose access or refuse to cooperate, funds can become permanently unreachable. For this reason, thresholds are usually set well below the total number of keyholders, and recovery modules or timelocks are often added for extra safety.