TL;DR
Most multisig losses don’t come from hackers but from small setup mistakes that only show up on the day you need a recovery. These are the ones this site warns about most, each with the page that shows how to avoid it.
Backups
1. No backup of the wallet descriptor
Two seeds aren’t enough to find your coins: you also need the descriptor with all three public keys. Keep a printout and a USB stick with every seed. It holds no private keys, so make plenty of copies. Fix: step 7; background in what is a wallet descriptor and lost your descriptor.
2. Two seeds in one place
One fire then destroys two keys, and you can’t spend anymore. One burglary gives a thief two keys, and then they can. Any place that can disappear in one event gets one seed at most. See where to store three seed backups.
3. Keeping the BitBox02 microSD backup
The BitBox02 saves your seed to a microSD card by default. That card isn’t protected by a password: whoever finds it can restore your wallet. Choose Advanced options at setup and write down the 24 words. See step 4 and the BitBox02 review.
4. Accepting the Trezor 20-word default
Trezor offers a 20-word SLIP39 backup by default. Your BitBox02 and Ledger can’t restore it, and it can’t be converted later. Pick the 24-word option during setup. See BIP39 vs SLIP39 and step 4.
5. Typing, photographing or storing seed words
Seed words go on paper, then on metal, and back into a hardware wallet if you ever restore. Nowhere else. Anyone who asks for them, including “support”, is a scammer. See the seed rules in step 4 and someone asks for your seed words.
Buying
6. Three devices of the same brand
One bug, bad batch or supply chain problem then hits all three keys at once, and your 2-of-3 is a single point of failure again. See why use three brands.
7. Buying from a reseller or third-party seller
Buy only from the maker’s own shop or from Amazon.com itself (“Ships from and sold by Amazon.com”). Not from resellers, not even official ones, not second-hand, not from a marketplace seller. Then do the tamper check. See the Ledger reseller attack and the tamper check.
Setup and use
8. Forgetting to unlock the passphrase wallet
Every passphrase opens a valid wallet, and so does none at all. Connect a device without unlocking the passphrase wallet and Sparrow gets the keys of an empty wallet, without a warning. See passphrase with multisig and the check in step 10.
9. Not verifying receive addresses
A tampered computer can show you an attacker’s address. Check every address you hand out, every character, on the BitBox02 or the Ledger after registering the multisig. The Trezor shows what Sparrow sends, so it’s only an extra check. See step 8 and address doesn’t match.
10. Never rehearsing a recovery
A backup you’ve never restored is a guess. Rebuild the wallet from the descriptor on the USB stick in a fresh Sparrow, compare the addresses, and do it before real money goes in. Then once a year. See step 10 and the yearly check-up.
Smaller ones that still bite
- Aluminum or brass plates. They melt in a house fire (step 5).
- Checking the metal plate against the paper only, not against the device (step 5).
- Using your everyday laptop “just this once” (step 2).
- Testing only receiving. Receiving proves nothing about spending (step 9).
- Nobody in your family knows the vault exists (inheritance with multisig).
One mistake costs nothing, two can cost everything
A 2-of-3 forgives one lost key. Most of the mistakes above quietly use up that margin before you notice. Fix them while nothing is wrong yet.