Multisig is considered one of the most secure methods for storing crypto assets, especially for those thinking about long-term or generational wealth. By requiring multiple keys to authorize any transaction, multisig offers a major security upgrade over the standard single-signature (singlesig) wallet that relies on just one private key. If one key is compromised, multisig structures ensure that another layer of protection is in place to keep your funds secure. In fact, multisig can even help mitigate the two biggest risks in Bitcoin storage: theft and accidental loss.
1. Overview of The Crypto Security Options
What are the different options to handle your security?
I tried to summarize them here:
Exchange Wallets
Description: These are wallets provided by exchanges (e.g., Binance, Coinbase) where you can buy, sell, and store cryptocurrencies.
Security: Lower security as the private keys are controlled by the exchange, not the user. Funds may be at risk in case of hacks or exchange failure.
Pros: Convenient for active traders and beginners; exchanges often offer insurance.
Cons: Centralized; funds are vulnerable to hacks, exchange mismanagement, or regulatory intervention.
Software Wallets (Hot Wallets)
Description: These are digital wallets stored on internet-connected devices, like mobile apps or desktop applications (e.g., MetaMask, Trust Wallet).
Security: Moderate security, as private keys are kept on the device. However, exposure to the internet increases hacking risk.
Pros: Convenient for frequent transactions; easy to set up and use; allows users to retain private keys.
Cons: Vulnerable to malware, phishing attacks, and device theft.
Hardware Wallets (Cold Wallets)
Description: Physical devices (e.g., Ledger, Trezor) that store private keys offline.
Security: High security, as they keep keys offline. Even if connected to an infected computer, the wallet is resistant to attacks.
Pros: Secure offline storage; suitable for long-term holders; supports multiple cryptocurrencies.
Cons: Less convenient for frequent transactions; comes with a one-time cost; requires safe storage of the physical device.
KYC-Custodial Institutions (Institutional Solutions)
Description: Some institutions offer regulated custodial services that store crypto on behalf of clients (e.g., Coinbase Custody, Fidelity Digital Assets). These typically require KYC.
Security: High, as institutions use robust security measures and often have insurance.
Pros: Suitable for institutions or high-net-worth individuals; includes insurance and regulatory protection.
Cons: Often costly; centralized custody can be a single point of failure; requires trust in the institution.
Multisig Wallets (Multi-Signature Wallets)
Description: These wallets require multiple signatures to authorize transactions. A common setup involves requiring at least two of three keys to move funds.
Security: Very high, as it requires multiple parties or devices to approve transactions.
Pros: Useful for shared ownership (e.g., business partners) or added security (e.g., personal setup with separate devices); prevents a single point of failure.
Cons: More complex to set up and use; requires secure management of multiple keys; may have higher transaction fees.
2. Why Mulstig?
Imagine this: with one hardware wallet, a “singlesig wallet”, a loss or an exposed private key can lead to losing all of your Bitcoin. But with a multisig setup, you hold multiple keys, each stored in a different location. Even if one key is lost or stolen, the others can still be used to access your funds safely. This redundancy means that you’re not dependent on one single point of failure, offering peace of mind that your Bitcoin will be there when you or even future generations need it.
Multisig is not just for individual security—it also provides solutions for groups, companies, and even governments that want to store Bitcoin collaboratively. By structuring multisig wallets that require multiple approvals, multisig empowers people to safely manage funds as a team, protecting against the potential risks of centralized custody and unauthorized access.
While multisig introduces some complexity, the trade-off is well worth it. In this guide, we’ll explore what multisig is, how it compares to singlesig wallets, and the specific benefits it offers for those interested in long-term Bitcoin storage. We’ll walk through some common multisig setups, like 2-of-3 or 3-of-5, and look at both DIY and collaborative custody options to help you determine which is best for your needs.
One of the best options to maximise security and reduce complexity is the 2-of-3 setup where 3 keys exist for a given wallet, 2 are needed to approve a transaction and 1 is given to a custody provider that will provide support and approval when needed. You can see that as a backup held by a third party that doesn’t give them any power alone.
This video explains the concept well:
3. What are the DIY Multisig options?
Electrum Multisig
Electrum is a Bitcoin wallet that allows users to create a custom multisig setup. It’s a flexible option that can be set up with multiple hardware wallets or even mobile wallets. Security is high, particularly when using a mix of hardware wallets. To set up, users choose the number of signatures required and add the public keys of each participant. The wallet can be created on any device that runs Electrum. This option is user-friendly for a multisig wallet, supports cold storage, and allows mixing hardware wallets with software wallets. However, it’s limited to Bitcoin and requires some understanding of Electrum’s advanced features.
Sparrow Wallet Multisig
Sparrow Wallet is an open-source Bitcoin wallet that supports custom multisig setups with compatibility across multiple hardware wallets. Security is high, especially when using hardware wallets, and Sparrow allows for air-gapped setups. Similar to Electrum, Sparrow lets users define the number of keys and supports importing public keys from hardware wallets. Sparrow has a modern interface, flexible multisig support, and supports both online and air-gapped setups, though it is Bitcoin-only and requires some technical knowledge for optimal security.
Nunchuk Wallet Multisig
Nunchuk is a Bitcoin wallet designed specifically for multisig setups, allowing users to invite participants and create collaborative wallets. It also supports key management for individual participants. Security is high, integrating well with hardware wallets and enabling a “multiplayer mode” for collaborative signing with remote participants. Users can choose between 2-of-3, 3-of-5, or custom setups and use both hardware and mobile wallets. Nunchuk is user-friendly, designed with multisig in mind, and supports collaborative wallet management. However, it is limited to Bitcoin and relies on the Nunchuk app infrastructure.
Unchained Capital Caravan
Caravan is an open-source multisig coordinator created by Unchained Capital for Bitcoin. It’s a highly flexible tool that allows users to set up multisig wallets with hardware wallets and generate secure wallets offline. Security is high, especially for those setting up wallets offline with air-gapped hardware. Users can manually import xpubs (public keys) from hardware wallets and define the number of required signatures. Caravan is open-source, allows offline setup, and provides flexibility for advanced users. However, it requires some technical skill, is Bitcoin-only, and has no native mobile app support.
BlueWallet Multisig Vault
BlueWallet is a mobile wallet that allows users to create a multisig vault directly on their phone or with hardware wallets. Security is moderate to high, depending on the device, and better with hardware wallets. Users can create a multisig vault by adding keys from hardware wallets or using a single mobile device, with BlueWallet supporting custom M-of-N schemes. It is mobile-friendly, integrates with hardware wallets, and has an easy setup process, though it is Bitcoin-only and has a higher risk if used solely on mobile without hardware support.
Specter Desktop
Specter Desktop is a Bitcoin wallet designed for multisig setups with hardware wallets and provides full control of key management. Security is very high, especially when paired with hardware wallets and air-gapped devices. Users create a multisig wallet by importing public keys from multiple hardware wallets, with Specter allowing an offline setup via QR code scanning. It is highly secure, open-source, and supports advanced setups with multiple hardware wallets. However, it is Bitcoin-only, desktop-only, and requires some technical knowledge.
Casa Keymaster (DIY Multisig)
Casa Keymaster offers multisig solutions and can be used as a DIY option, allowing users to control their private keys with minimal involvement from Casa. Security is high, especially in a 3-of-5 setup with geographically distributed keys. Casa provides hardware wallets and support to configure multisig wallets with setups like 2-of-3 or 3-of-5. It simplifies the multisig setup process, supports hardware wallets, and offers strong security for long-term holding, though there are subscription fees, and it requires trust in Casa’s infrastructure.
DIY Hardware Wallet Multisig Setup
Some users opt to create multisig setups entirely with hardware wallets and offline management, without third-party wallets. This approach typically involves generating keys with hardware wallets and using open-source tools to coordinate transactions. Security is very high, as the entire setup is offline and self-hosted. Users manually import xpubs from each hardware wallet and coordinate transactions independently. This setup offers maximum security with air-gapped devices and complete control over private keys but is technically demanding, time-consuming, and lacks support from wallet providers.
Each of these DIY multisig options offers varying degrees of security, user-friendliness, and technical requirements, making it possible for users to find a setup that matches their unique needs and level of expertise.
4. What are the collaborative multisig options
Here is my list:
Unchained Capital Collaborative Custody
Unchained Capital offers a collaborative custody service that combines a 2-of-3 multisig setup, where one key is held by Unchained, one by the client, and one by a trusted third party or additional user hardware wallet. This setup offers high security, as Unchained acts only as a co-signer and does not have full control over funds. The user initiates transactions and requests Unchained to co-sign when necessary. This approach provides added security by distributing keys and is especially appealing for users seeking custody assistance without fully relinquishing control. While limited to Bitcoin, Unchained offers excellent customer support and a streamlined user experience.
Casa Multisig
Casa’s multisig solution offers a 2-of-3 or 3-of-5 collaborative setup where clients control the majority of keys while Casa holds a backup key. The client distributes keys across different devices and/or geographical locations. Casa’s platform includes guided setup, secure key storage recommendations, and recovery support if a device is lost. This solution allows users to retain control of their funds, with Casa acting only as an emergency backup co-signer. Designed to prioritize ease of use, Casa’s multisig solution includes a user-friendly mobile app with high security, though it requires a paid subscription and is limited to Bitcoin.
Nunchuk Assisted Multisig
Nunchuk offers a collaborative multisig solution with a unique “collaborative mode” for transactions. In this setup, users can invite others (e.g., family members or business partners) to be co-signers. Nunchuk can also provide a key management service to assist in recovery or emergency scenarios. This option is accessible and secure, supporting integrations with hardware wallets and mobile devices. It allows for custom M-of-N schemes, making it versatile for both personal and shared custody needs. Nunchuk’s setup is flexible, allowing users to manage roles and permissions for each co-signer, though currently limited to Bitcoin.
Blockstream Green Multisig
Blockstream Green offers a unique 2-of-2 multisig setup where one key is held by the user and the other by Blockstream. The Blockstream Green wallet provides a mobile-friendly interface, advanced security features, and integration with hardware wallets. In this collaborative setup, Blockstream acts as a co-signer, allowing users to retain control over their funds while adding a layer of security. This wallet is especially useful for users who prefer a straightforward setup but want the reassurance of a co-signer. While this solution has fewer customization options, it is secure and convenient for users comfortable with a 2-of-2 configuration.
Komainu Institutional Multisig Custody
Komainu offers institutional-level multisig custody services, typically for corporate clients or high-net-worth individuals. In this setup, Komainu holds one key as a regulated custodian, with additional keys controlled by the client or a trusted third party. This setup is designed for secure, regulatory-compliant storage of crypto assets, combining multisig security with institutional-grade custody and insurance. Komainu’s platform is built for clients needing to meet regulatory requirements or those who seek highly secure, collaborative custody options. While geared toward institutions, Komainu provides a strong combination of security, compliance, and support, though it’s tailored more for high-stakes holdings than casual use.
Fireblocks Multisig Wallet as a Service (WaaS)
Fireblocks provides a multisig Wallet as a Service (WaaS) solution, primarily for institutions and businesses. Fireblocks offers a secure environment where institutions control their assets using a collaborative multisig setup with Fireblocks managing one of the keys. The platform integrates key management, secure transaction signing, and support for various cryptocurrencies. Fireblocks uses a proprietary “MPC” (multi-party computation) process rather than traditional multisig, providing a robust security framework for high-value assets. This collaborative setup suits companies that need secure crypto asset management with extensive support and regulatory compliance, though it is oriented toward larger entities with substantial funds.
Each of these collaborative multisig options provides a blend of security, convenience, and shared control, making them ideal for users or institutions seeking professional co-signers or custody assistance without full relinquishment of private keys. These solutions cater to a range of needs, from individual users to large organizations, ensuring that security is enhanced through multisig setups while allowing flexibility in control and recovery options.
