A multi-signature wallet, often called a multi-sig wallet, requires multiple private keys to authorize a transaction. Instead of relying on a single key for security, it combines several keys from different users or devices. This adds an extra layer of protection against unauthorized access.For example, a wallet might be set up to require three keys out of five available. In this scenario, even if one or two keys are compromised, the funds remain secure since not enough keys are available to authorize a transaction.Multi-signature wallets are useful for businesses or groups managing shared funds. They prevent a single person from unilaterally spending the funds, promoting collaboration and accountability. Additionally, they can help safeguard against loss; if one key is lost, others can still access the wallet.Overall, multi-signature wallets enhance security, reduce risk, and ensure better oversight for managing cryptocurrency transactions.