Elementary explanation of a multisig wallet and its importance.
What's a Multisig?
The most widely known example of a smart contract wallet is a multisig. They have been around since the early days of Bitcoin and are widely used for the purposes of self-custody of crypto assets across blockchains.
A multisig is a non-custodial solution where control over assets is not exercised by a single private key, but rather by multiple private keys. It can be thought of as a safe that requires multiple unique keys to open it and move the assets. That means that even if one of the keys is compromised the assets remain secure (no single point of failure).
Every Squad is a multisig at its core, which ensures that any transaction or action taken within Squads requires the approval of multiple members of the team. As a result, the risk of unauthorized or malicious activity is greatly reduced, as it becomes impossible for a single owner to access and manipulate funds or trigger harmful transactions to the protocol. On top of that multisignature technology serves as a consensus mechanism allowing teams to make decisions over core team assets together in a decentralized manner.