A lot of financial processes require multiple signatories, like a wire transfer for example. That adds a level of security and comfort to a process that moves a lot of funds quite quickly.
So it makes sense that blockchain technology would find a way to mimic that in software.
It is called a “mult-sig wallet” and if you use one, you need multiple “signatories” to move funds out of the wallet. I put signatories in quotations because what you actually need is multiple private keys to move funds out of the wallet.
CoinCenter wrote a nice explanation of multi-sig technology back in early 2015 that I frequently share with people who ask me about multi-sig. Give that a read if you want to learn a bit more about how this technology works and why it is so useful.
Our portfolio company Coinbase uses multi-sig technology in its vault product which is currently available for Bitcoin wallets and will eventually come to its other wallet offerings.
If you use a hardware wallet like Ledger, you can use the BitGo software to get multi-sig on it. Here’s a blog post about that.
With the big increase in crypto prices this year, many people are now holding significant amounts of crypto assets. It is worth taking security more seriously and putting your assets, or at least most of them, into a multi-sig wallet is a good step toward that.
