There are two ways of creating a multisig transaction: Pay-to-multisig, or a Pay-to-script-hash. currently we will focus on the P2MS or what we refer to as Bare mutisig or Raw multisig

P2MS enables multiple parties to agree to a transaction before it can be spent.

This is a script where M out of N possible signers must provide a valid signature for the funds to be spent.

For example, in a 2-of-3 multisig, any two of the three signers can authorize a transaction.

The visualization below allows you to see how this works:

Multisig Setup:12Of123

Alice

Sign transaction

Bob

Sign transaction

2 of 2 Multisig Wallet

1. Locking (ScriptPubKey)

To create a raw P2MS script, include the following in the ScriptPubKey:

1 
2M
3<PubKey1>
4<PubKey2>
5<PubKeyN>
6N
7OP_CHECKMULTISIG
8  

• M: Number of required signatures
• Public keys of all participants
• N: Total number of public keys
• OP_CHECKMULTISIG opcode

Example: Click on Output 1 of the transaction below to view the scriptPubKey for a 2-of-3 multisig transaction.

2. Unlocking (ScriptSig)

To spend bitcoin from a P2MS ScriptPubKey, the spenders must provide the required number of valid signatures.

For a 2-of-3 multisig, the unlocking script look like this

1 
2OP_0
3<Signature1>
4<Signature2>
5  

Click on Input 1 of the transaction to view the ScriptSig created to unlock the multisig output we gave before

Order of Signatures in P2MS

Providing signatures in the correct order is highly recommended for efficiency. If signatures are out of order, the script will still validate, but it may require more computational steps, which will slow down the verification process.

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