Bitcoin multisig inheritance

A multisig wallet requires more than one key to spend, commonly 2-of-3 or 3-of-5. That is a deliberate security design, and it has specific inheritance consequences: some keys may be with other people or institutions, and the death of the main keyholder does not end the wallet.

What multisig is

In an ordinary wallet, one key is enough. In a multisig wallet, several keys are in play: for example 2-of-3 (two of three signers are required) or 3-of-5. The combination “how many of how many” is called the threshold. Multisig is used by businesses, joint ownership and people who want extra protection against theft, and it changes what an estate needs to find.

How it changes inheritance

• The wallet survives the keyholder. As long as the required number of keys is available, the funds can still be moved, the multisig does not “die” with its owner.
• The other signers become the practical route. Family and executors may not even know the other signers exist.
• Key locations matter more than the wallet file. The estate must find out where the keys are, not just that a multisig setup existed.
• A lost signer can block everything. At 2-of-3 with three living signers, everything still works after one person falls away; at 2-of-2 it no longer does. Even temporary unavailability can stall an estate.
• Descriptors and scripts are technical reality. Wallets today use descriptors (output script descriptors), the estate may need an expert just to understand what the setup is. That is a technical question, not a reason to hand over secrets.

What owners should plan

1. Document the structure, not the secrets: which keys exist, who holds them, what threshold applies, without including the key material itself.
2. Name the co-signers in your estate map and tell them you have done so (privacy permitting) so they can act when needed.
3. Plan for a lost signer. If one of your own keys disappears with your death, is the threshold still reachable?
4. Consider a signer-rotation clause with a qualified adviser; multisig setups can be redesigned while you are alive, and that is the only safe time to do it.
5. Arrange a secure reserve for one of your keys (a bank box, a trusted person under a formal arrangement) so the threshold remains reachable.

What heirs should do

• Find the documentation before touching anything (estate inventory).
• Do not guess. Attempting to reconstruct a multisig from memory is how keys get locked.
• Understand the limits, multisig adds complexity, and if too many keys are lost, even a specialist cannot invent them (wallet recovery: what is realistically possible).
• Get a professional review of the setup, a multisig configuration is not a standard setup; the structure, documentation and continuity arrangements deserve periodic expert assessment alongside the legal adviser.

Multisig is one of the strongest planning tools for inheritance, but only when the structure is documented in the estate plan. See crypto inheritance planning for the full method.