Why Shared Multisig Wallets Are the Next Infrastructure Play in Bitcoin Custody for 2025 and Beyond

The Bitcoin custody landscape is undergoing a seismic shift, driven by a confluence of security imperatives, regulatory evolution, and technological innovation. At the heart of this transformation lies the rapid adoption of shared multisig wallets-a model that is redefining how both institutional and retail investors secure their digital assets. By 2025, multisig solutions have emerged not merely as a security preference but as a foundational infrastructure layer for Bitcoin custody, underpinned by market growth, regulatory clarity, and a growing consensus among industry experts.

The Rise of Shared Multisig: A Market-Driven Shift

The adoption of shared multisig wallets has accelerated dramatically in 2025, fueled by a global preference for non-custodial solutions. According to a Coincub report, 59% of crypto wallet users now prioritize self-custody tools, with multisig options gaining traction as a secure alternative to single-signature wallets. The market size for multisig wallets ballooned to $1.27 billion in 2024 and is projected to reach $4.37 billion by 2033, reflecting a compound annual growth rate (CAGR) of 15%. This surge is particularly pronounced in the institutional sector, where wallet usage grew by 51% year-over-year, and hardware wallet sales-often tied to multisig support-are forecasted to hit $560 million in 2025.

Retail adoption has mirrored this trend, driven by innovations such as keyless recovery and multi-party computation (MPC) security. These advancements have eliminated the reliance on traditional seed phrases, reducing common failure points and making multisig wallets more accessible to everyday users. The integration of multisig into blockchain networks and decentralized finance (DeFi) platforms has further normalized its use, positioning it as a default standard for asset protection.

Security Imperatives: From Breaches to Resilience

The urgency of this shift is underscored by the staggering losses from custody breaches in 2024–2025. Over $2.17 billion was stolen from crypto services in 2025 alone, with the DPRK's $1.5 billion hack of ByBit marking a watershed moment. These incidents exposed the vulnerabilities of single-key custody models, where a single compromised key can lead to catastrophic losses. In contrast, multisig wallets require multiple private keys to authorize transactions, effectively eliminating single points of failure.

Practical guides from custody providers emphasize the advantages of 2-of-3 multisig setups, which distribute keys across geographically dispersed locations and enable emergency recovery workflows. Insured multi-entity vaults, where investors and third parties co-sign transactions, have further enhanced this model by adding insurance coverage for edge-case risks. For institutions, multisig has become a cornerstone of enterprise-grade custody, enabling multi-approver governance and auditability.

Regulatory Tailwinds: Compliance as a Catalyst

Regulatory developments in 2025 have amplified the case for multisig adoption. In the U.S., the SEC's proposed "safeguarding rule" mandates that digital assets be held by qualified custodians meeting stringent security standards. Similarly, the EU's Markets in Crypto-Assets (MiCA) regulation, fully enforced in 2025, requires crypto custodians to obtain licenses and adhere to strict governance and reporting protocols. These frameworks implicitly endorse multisig principles, as they emphasize private-key management, segregation of customer assets, and cybersecurity protocols-practices inherently aligned with multisig's multi-layered security model.

New York's Department of Financial Services (NYDFS) also updated its custody guidelines, reinforcing the need for custodians to limit virtual currency use to safekeeping purposes and mandate due diligence on sub-custodians. These regulatory shifts signal a broader industry-wide recognition that robust custody infrastructure is critical for institutional trust and retail adoption.

Expert Endorsements and Industry Consensus

While explicit endorsements of multisig by experts are not detailed in the sources, the alignment between regulatory priorities and multisig's operational framework suggests a de facto endorsement. The BitcoinTaxes blog, for instance, highlights the importance of insurance and service-level agreements (SLAs) in institutional custody models, underscoring how multisig's distributed control mechanisms provide accountability and risk mitigation. Meanwhile, custody service providers stress the balance between operational ease and security, particularly in insured multisig vaults.

The Elliptic report further contextualizes this trend, noting that global regulatory frameworks like MiCA and Hong Kong's stablecoin regime have reduced ambiguity and fostered innovation. As compliance teams and custodians adopt practices akin to multisig requirements-such as multi-layered key management and sub-custodian oversight-the technology's role as infrastructure becomes increasingly entrenched.

Conclusion: A Strategic Inflection Point

The strategic shift toward shared multisig wallets represents more than a response to security threats or regulatory demands-it is a fundamental reimagining of Bitcoin custody. For institutions, multisig offers a scalable, auditable solution that aligns with corporate treasury strategies. For retail users, it provides a user-friendly yet robust alternative to traditional wallets, bridging the gap between security and accessibility.

As the market continues to mature, the convergence of technological innovation, regulatory clarity, and investor demand will cement multisig as the dominant security model. Investors and developers alike should view this transition not as a passing trend but as a critical infrastructure play-one that will define the next phase of Bitcoin's adoption and institutionalization.