How to create a Multi Signature Wallet

Tuesday, 29 Nov 2016 08:02

 

One of the biggest advantages to digital currencies is the ability to have programmable money or smart contracts. These are basically transactions that execute automatically given that certain predetermined conditions are met. One of the most basic forms of programmable money is multi-signature addresses also known as multi-sig.

Multisignature addresses are like joint bank accounts where the transactions must be authorized by more than one signature holder. This is extremely useful in order to execute transactions where trust hasn’t been established or to create community managed funds. . Today we want to show you how to easily set up a Multi-signature wallet using BitPay app, a supported distribution of Copay, including built-in integration with the BitPay Card. Bitpay does not store your private keys and has an intuitive user interface. However, validation in Copay is centralized, meaning that you have to trust the wallet provided to keep a legitimate copy of the blockchain.

Today we want to show you how to easily set up a Multi-signature wallet using BitPay app, a supported distribution of Copay, including built-in integration with the BitPay Card. Bitpay does not store your private keys and has an intuitive user interface. However, validation in Copay is centralized, meaning that you have to trust the wallet provided to keep a legitimate copy of the blockchain.

Part 1 - Download and Install the wallet

Step 1: Click here to visit the BitPay download section and choose the version that best fits your Operative System

Step 2: Once the download is complete install the Setup

Part 2 - Create and backup wallet

Step 1: Launch your newly installed BitPay app and click “Get Started

Step 2: You’ll be shown three educational slides about Bitcoin and BitPay. Once you reach the last one you’ll be prompted to create a new wallet. Click the “Create bitcoin wallet

Step 3: Now you’ll be prompted to backup your wallet, a very important step. You’ll be shown a seed phrase, which allows you to restore access to your wallet anywhere. Backup your wallet seed and store it safely. Be aware of your surroundings when doing so.

Step 4: Write down your 12 seed words or store them in a file. When you’re done click “I’ve written it down

Step 5: Now you’ll be asked to rearrange words to form your seed. This shouldn’t be a problem since you’ve written it down. Click “Confirm” when you’re done.

Step 6: Now Agree to the Terms and Conditions and click “Confirm & Finish

Part 3 - Create a Multi-Signature Wallet address

Step 1: Now that you have created and backed up your main wallet, it’s time to create a multi-signature wallet. Click the plus sign on the right upper side of the “Wallets” tab

Step 2: Now click “Create shared wallet” to start a multi-signature address

Step 3: Choose the name of the wallet and your username in the shared wallet context

Step 4: Once that’s done, it’s time to choose the number of signature holders (1) and the required number of signatures to authorize a transaction (2). This is the most important part as it will define the nature of the multi-signature wallet. If you choose an account with 3 signature holders but only 1 signature required, any of the 3 signature holders can withdraw funds on it’s own. If you create a wallet with 3 signature holders and 2 required signatures, it will create a perfect environment to hold funds between two users and a middleman.

Step 5: Your multi-signature wallet has been created and it’s ready to receive new key holders. Just share the code shown to invite your co-signature holders.

Part 4 - Join a Multi-Signature Wallet address

Step 1: In order to join a Multi-signature wallet created by somebody else, click the plus sign on the right upper side of the “Wallets” tab again

Step 2: This time you want to click “Join shared wallet” to join a multi-signature address.

Step 3: Then enter your nickname and invite code (like the one shown in Part 2)

That’s it! You are now the proud co-owner of a Bitcoin multisignature address, which can make your life way easier when dealing with cryptocurrency.

 

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