Multisig

Multisig, short for multi-signature, is a wallet setup where a transaction needs approval from more than one key. A 2-of-3 multisig has three keys and requires any two to sign. A 3-of-5 has five keys and requires three. If one key is lost or stolen, the funds remain safe and accessible with the remaining keys.

Multisig is standard for organizations. DAO treasuries, company funds, and protocol admin controls are commonly held in Safe (formerly Gnosis Safe) multisig contracts on Ethereum, where several team members must each approve a transfer. Exchanges and custodians use multisig or similar threshold schemes so that no single employee can move customer assets.

Individuals use multisig to protect against a single point of failure. A person might hold one key on a hardware wallet at home, another at a relative's house, and a third with a collaborative custody service. Setting it up is more complex than a single wallet, and losing enough keys to fall below the threshold still means permanent loss.