Bitcoin owners generally secure their cryptocurrency using a combination of a public and private key. This way. they can sign in each of their transaction.
This works fine in most use cases, but there are situations where this method is far from ideal.
For example, when a founder of a cryptocurrency exchange secures all of the firm’s assets with their private key. This may lead to several problematic situations: if the founder dies, got hacked or initiate an 'exit scam'. In all of those situations, the exchange would lose all of their funds.
In order to eliminate these issues, a soft fork was introduced in 2012 that enabled the use of multi-signature wallets.
This way, wallets can be controlled by multiple users, without any one user having the ability to spend the coins on their own.
According to Cointelegraph, about one-third of the total supply of Bitcoin, is already stored using multi-signature wallets.
That's almost 6 million Bitcoins.
