A single-signature wallet is a single point of failure. One compromised key, one phishing attack, one stolen device — and everything is gone. For any team, DAO, protocol treasury, or individual managing significant capital on Solana, a multisig wallet is not optional. It is a security requirement.
A multisig (multi-signature) wallet requires multiple private keys to authorize a transaction. A "2-of-3" multisig, for example, needs two out of three designated signers to approve before any funds move. This eliminates single-key risk and enforces collective decision-making.
Solana has three main approaches to multisig: Squads Protocol (purpose-built), Realms (DAO governance with multisig), and manual multisig (native Solana multisig instructions). This guide compares all three in detail.
Quick Comparison
| Feature | Squads | Realms | Manual Multisig |
|---|
| Primary purpose | Team treasury & multisig | DAO governance | Raw multisig |
| UI quality | Excellent | Good | None (CLI only) |
| Setup difficulty | Easy | Medium | Hard |
| Custom thresholds | Yes (M-of-N) | Yes | Yes |
| Transaction builder | Yes (visual) | Yes (proposal-based) | No |
| DeFi integration | Extensive | Limited | Manual |
| Program upgrades | Yes | Yes | Yes |
| NFT support | Yes | Limited | Manual |
| Audit status | Multiple audits | Audited | N/A (native) |
| Cost | Free (premium tiers available) | Free | Free |
Squads Protocol
Squads is the leading multisig platform on Solana. It was built from the ground up as a team treasury and asset management tool, and it shows in the product quality.
Setup
Creating a Squads multisig takes about 5 minutes:
- Connect your wallet (Phantom or Solflare)
- Add member wallet addresses
- Set the approval threshold (e.g., 2-of-3, 3-of-5)
- Deploy the multisig vault (costs a small SOL fee for account creation)
Key Features
Transaction builder: Squads provides a visual transaction builder where you can compose complex transactions — token transfers, program interactions, DeFi operations — without writing code. Queue a transaction, share it with co-signers, and execute once threshold is met.
Spending limits: Set per-member or per-period spending limits. A team member might be authorized to spend up to 10 SOL per week without full multisig approval, but anything above requires the full threshold. This balances security with operational speed.
Sub-accounts: Create multiple vaults within one Squads instance. Separate your operating treasury, development fund, and marketing budget into distinct accounts with different approval rules.
DeFi access: This is where Squads truly excels. You can interact with Solana DeFi directly from the multisig:
All DeFi interactions go through the same multisig approval flow — compose the transaction, collect signatures, execute.
Program upgrade authority: If you're a development team managing Solana programs (smart contracts), Squads can hold the upgrade authority. This means program upgrades require multisig approval, preventing a rogue developer from deploying malicious code. This is a critical security measure for any protocol with user funds.
Roles and permissions: Assign different roles to team members:
- Proposer: Can create transactions but not approve them
- Voter: Can approve transactions
- Executor: Can execute approved transactions
- Admin: Can modify multisig settings
Who Should Use Squads
- Project teams managing a treasury or protocol
- DAOs that need an efficient treasury management tool (not just governance votes)
- Individuals managing high-value portfolios who want key redundancy
- Development teams who need multisig program upgrade authority
Limitations
- Requires all signers to have Solana wallets and actively participate in approvals
- Mobile experience is less polished than desktop
- Some DeFi protocols may not support Squads vaults natively (though this is improving)
Realms
Realms is Solana's native DAO governance platform. While it includes multisig functionality, it is designed primarily for token-based governance with voting, proposals, and council structures.
How Realms Differs from Squads
Realms is a governance system that can function as a multisig. Squads is a multisig that can handle governance. The difference matters:
- Realms is ideal when you have a token-holding community that votes on proposals, with a council (multisig) for execution
- Squads is ideal when you have a small team that needs to co-manage funds efficiently
Setup
- Navigate to Realms and connect your wallet
- Choose governance type: multisig council, token-based community, or hybrid
- Add council members (for multisig mode)
- Configure approval thresholds and voting periods
- Deploy the governance program
Key Features
Proposal-based workflow: Everything in Realms goes through proposals. To transfer funds, a member creates a proposal, adds the transaction instruction, and council members vote. This creates an on-chain audit trail of every decision.
Token-weighted voting: For DAOs with governance tokens, Realms supports token-weighted voting where voting power is proportional to token holdings. This is essential for community governance but not relevant for simple multisig use.
Dual governance: Realms supports a council (small group, like a multisig) and a community (token holders) with separate thresholds. The council might manage day-to-day operations, while the community votes on major decisions like treasury allocations over a certain size.
Veto power: Configure the community to have veto power over council decisions, adding a check-and-balance layer.
Time-locked execution: Proposals can have a mandatory waiting period between approval and execution, giving the community time to react.
Who Should Use Realms
- DAOs with governance tokens that need community voting
- Protocols with dual governance (council + community)
- Projects that want on-chain proposal history as an accountability record
- Large organizations where governance complexity justifies the overhead
Limitations
- The proposal workflow adds friction for routine transactions (less suitable for daily treasury management)
- UI is functional but not as polished as Squads
- Token-based governance features add complexity even if you only need a simple multisig
- Slower iteration speed — governance votes take time
Manual Multisig (Native Solana)
Solana's base layer supports multisig natively through the System Program and SPL Token multisig accounts. No third-party protocol needed.
How It Works
A native Solana multisig creates an on-chain account that requires M-of-N signatures to authorize transactions. You create the multisig account using CLI commands, specifying the signer public keys and threshold.
Setup (Requires CLI)
# Create a multisig token account (example: 2-of-3)
spl-token create-multisig 2 signer1_pubkey signer2_pubkey signer3_pubkey
For SOL multisigs (not SPL tokens), you use Solana's native multisig account feature, which is more complex and requires raw transaction construction.
When to Use Manual Multisig
- Maximum trustlessness: No dependency on any third-party protocol or UI
- Minimal attack surface: Fewer smart contracts involved
- Specific compliance requirements that mandate no third-party code
- Developer teams comfortable with CLI-based workflows
Limitations
- No UI: Everything is command-line. Signers need technical competence
- No transaction builder: You construct transaction instructions manually
- No DeFi integration: Interacting with DeFi protocols requires raw transaction crafting
- Error-prone: One wrong parameter can lock funds permanently
- Limited SPL token multisig: The native SPL multisig is designed for token accounts, not general program interaction
In practice, manual multisig is rarely the right choice. Unless you have a specific reason to avoid third-party code, Squads provides the same security with dramatically better usability.
Security Best Practices for Any Multisig
Regardless of which solution you choose, these practices apply:
1. Use Hardware Wallets for Signers
Each multisig signer should use a hardware wallet (Ledger). A multisig where all signers use hot wallets on the same network is vulnerable to coordinated attacks.
2. Geographic Distribution
Signers should not all be in the same location. If your 3-of-5 multisig has all 5 signers in one office, a physical security breach compromises everything.
3. Key Backup Procedures
Each signer must independently backup their seed phrase. The multisig is only as recoverable as its individual keys. Establish clear procedures for what happens if a signer loses access.
4. Regular Signer Rotation
When team members leave, rotate them out of the multisig immediately. A disgruntled former employee with signing authority is a security risk.
5. Test with Small Amounts First
Before moving significant funds into a new multisig, run test transactions with trivial amounts. Verify that every signer can approve, that execution works, and that the threshold behaves correctly.
6. Document Your Setup
Record (securely, offline) the multisig address, all signer public keys, the threshold, and the recovery procedure. Store this documentation separately from any private keys.
Threshold Recommendations
| Team Size | Recommended Threshold | Why |
|---|
| 2 people | 2-of-2 | Both must agree. If one is compromised, funds are safe |
| 3 people | 2-of-3 | One person can be unavailable without blocking operations |
| 5 people | 3-of-5 | Balances security (majority required) with availability |
| 7+ people | 4-of-7 or 5-of-9 | Simple majority prevents deadlocks while maintaining security |
Never use 1-of-N — that defeats the entire purpose of a multisig. It only takes one compromised key.
Avoid equal-to-total (N-of-N) for teams larger than 2 — one unavailable signer locks all funds. The exception is 2-of-2 for couples or business partners where both should always agree.
Squads vs Realms: Decision Framework
Choose Squads if:
- You are a small team (2-10 people)
- You need daily treasury management
- You want to interact with DeFi directly from the multisig
- You prioritize speed and UX
- You need program upgrade authority management
Choose Realms if:
- You have a governance token and community voting
- You need on-chain proposal records for transparency
- You want dual governance (council + community)
- You are comfortable with slower, proposal-based workflows
- Governance complexity is a feature, not a bug
Choose manual multisig if:
- You have specific compliance requirements against third-party code
- All signers are technically proficient with CLI
- You only need basic token transfers, not DeFi interactions
Final Thoughts
For the vast majority of teams and DAOs on Solana, Squads is the right choice. It combines security with usability in a way that makes multisig adoption practical for day-to-day operations. The DeFi integration means your treasury can earn yield without sacrificing security.
Realms serves a different need — community governance with on-chain accountability. If your project has a governance token and needs democratic decision-making, Realms provides the framework.
The worst choice is no multisig at all. Every week, Solana projects lose funds to single-key compromises. A 2-of-3 multisig on Squads takes 5 minutes to set up and eliminates the most common vector for catastrophic fund loss.
For broader wallet security practices, read our Solana wallet security checklist. For hardware wallet recommendations, see our hardware wallet guide.
