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What are Multi-Sig wallets?


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Multi-Sig wallets, also known as multi-signature wallets are crypto wallets that require two or more individuals to access or authorize an outgoing transaction. This kind of wallet has become a popular choice for those who jointly own cryptocurrencies or digital assets. It is a new trend that redefines how to own and store digital assets. Unlike other wallets that require just one ownership, several individuals can come together to use a single Multi-Sig wallet. However, the only drawback attached to it is that it is quite technical and hard to set up.

Those who jointly control or authorize transactions are called co-signers and the password used to access the shared multisig wallet is called the master public key. Unlike the traditional public key, you need to share the master public key with the wallets to make the wallet “multisig.” The co-signers can be two, three, four, and so on.

Since multi-Sig wallets require multiple signatures, transactions may take longer. The private key is usually divided between the co-signers and appears on the blockchain network as a single standard signature. This simply means for any transaction to go through on this wallet, it must have the approval of the majority of its co-signers. However, the authorization of a transaction starts with a single signature from a single trusted party. But as the signatures increases, the size of a transaction will also increase.

While the usage of multi-Sig wallets may have its benefits, it also has its downsides. Conflicting interests among co-signers, for instance, is one major disadvantage of using this wallet. One party may decide not to agree with the other on the initiated transaction. If the parties involved are more than two, they can go for a 2/3 option. This simply means if two third of the co-signers agree with the transaction, it will go through. If otherwise, the transaction may not go through. This approach makes the usage of Multi-Sig wallets complicated to use, particularly during emergencies.

Are Multi-Sig Wallets truly safe?

Multi-Sig wallets are entirely safe and they represent one of the safest ways of storing cryptocurrency. However, many considered it unnecessary due to the rigorous process of setting it up. Also, since it requires two or more people to have access to the private key, Multi-Sig wallets may not be ideal for an individual user. This is not due to security concerns, instead, requiring the approval of another individual to send out your assets can be stressful. 

On the flip side, having another individual; a trusted one to have access to your assets can be another level of protection. To an extent, it can be likened to a two-way authentication method of protecting unwarranted access to your cryptocurrency. Consequently, with a Multi-Sig wallet, your assets are safe even when intruders attempt to infiltrate the wallet through one of the users. Hence, the other partner with access to the wallet can foil the attempt of the attacks. 

However, despite the security benefits this interesting innovation offers, Multi-Sig wallets are more ideal for storing voluminous assets belonging to partners, businesses, institutional investors, communities, and many others. First, this is due to the extra layer of security they offer in protecting users assets which is more ideal for a large quantity of cryptocurrencies.

Furthermore, the multi-approval mechanism of the wallet under view helps ensure transparency relating to the assets of two or more people. For couples, Multi-Sig wallets is similar to a joint bank account. With that, both partners can have access to the wallet and approve transactions. For businesses and institutional investors, Mult-sig wallets will give control of the assets to top executives of the organization. 


Multi-Sig wallets are safe and they protect users’ assets better. Although it may be technical and complicated to set up, it guarantees ultimatum security. Only that they are more befitting for voluminous assets belonging to an organization or individual investors. Meanwhile, individual investors can consider hardware wallets to protect their assets against unwarranted access. This is because hardware wallets are also safe and easier to set up compared to Multi-Sig wallets. While it is quite expensive, its offerings are worthwhile.

Olaleye Komolafe
Olaleye Komolafe
Olaleye is a professional reporter with vast experience in web3, cryptocurrencies, and NFT journalism. He enjoys writing about the evolving metaverse sphere and the prevalence in the crypto sphere. Notably, some of his contents have been published in numerous international publications. Away from the crypto world, Olaleye is a political scientist and a lover of football

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