Multisig requires several keys to sign, such as 2 of 3, removing single points of failure for theft and loss. Learn how to set it up safely.
Several keys, one lock
A multisig output requires m signatures from a set of n keys: for example 2-of-3.
Why use it?
- No single point of theft: one stolen key isn't enough.
- No single point of loss: lose one key and the other two still work.
- Shared control: a business can require two directors, or an inheritance plan can include a lawyer as the third key.
How it's built
Classic multisig uses OP_CHECKMULTISIG:
2 <pubkey A> <pubkey B> <pubkey C> 3 OP_CHECKMULTISIGIt's normally wrapped in Pay to script hash (P2SH) or P2WSH so the long script is hidden behind a hash until spending.
With Taproot, multisig can use OP_CHECKSIGADD in a script path, or MuSig2 key aggregation, so an n-of-n spend looks like a single signature.
The backup catch
To restore a multisig wallet you need enough seeds and every co-signer's public key (or the wallet's descriptor). Back that information up too. See How to back up a Bitcoin wallet.
Example setups
| Setup | Who holds keys | Protects against |
|---|---|---|
| 2-of-3 personal | You: two devices plus one backup elsewhere | One lost or stolen device |
| 2-of-3 shared | You, your partner, a trusted third party | One person losing access |
| 3-of-5 company | Five directors | Fraud by up to two people |
Common mistakes
- Keeping all keys in the same house.
- Backing up seeds but not the wallet descriptor or the other xpubs.
- Never testing a recovery.
Key takeaways
- Multisig needs m of n keys to spend.
- It protects against both theft and loss of a single key.
- Back up the descriptor or all xpubs, not only the seeds.
Common questions
Is multisig more expensive?
Yes, spending carries several signatures and keys. Taproot key aggregation can reduce this a lot.
What's the most popular setup?
2-of-3 is common: it tolerates one lost key and one stolen key.
Is multisig only for businesses?
No. Many individuals use 2-of-3 for savings.
Does multisig cost more in fees?
Classic multisig does. Taproot-based setups can make it as cheap as a single-signature spend.