Collaborative Custody

Collaborative custody is a security approach where digital assets are managed using a multisignature (multisig) setup, with keys split among multiple parties. Typically, the asset owner—such as an individual or organization—holds enough keys to remain in control, while other keys are managed by trusted third parties. This structure is frequently offered by institutional custodians, aiming to balance the risks between sole custody and relying entirely on external providers.

By spreading key responsibility across different entities, collaborative custody reduces single points of failure, which helps protect against hacks and internal mistakes. This arrangement strengthens asset protection by requiring cooperation among parties for transactions, making unauthorized access much more difficult.