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BTC-Only：How to Create a 2/2 Native Segwit Multisig Wallet on Sparrow

The BTC-Only firmware defaults to a Single-sig Wallet. To have a Multisig wallet, one can choose to create one on Sparrow, with Keystone as one of the Multisig participants, and then import it into Keystone 3 Pro.

Preparation:

  • Check Battery: Ensure your Keystone wallet's battery is at least 20% charged.
  • Two Multisig Participants:
  • Software Wallet: Install and set up Sparrow Wallet V1.8.5 or newer on your PC/Mac

1. Creating a 2/2 Multisig Wallet on Sparrow Wallet​

  • Run Sparrow Wallet, click [File] > [New Wallet] > Enter wallet name > [Create a new wallet] > Choose "Multi Signature" in [Policy Type] option.

Importing the Extended Public Key (xPub) of Keystone as one of the Multisig Participants​

  • On Keystone 3 Pro:
    • Complete wallet basic setup, generate/import a set of seed phrase.
    • Navigate to 【Wallet Profile】on the top left corner of the home page.
    • Click on [Show/Export xPub] below and select [Multisig Wallet], a QR code will appear.
  • On Sparrow:
    • Select [Keystore 1] > [Airgapped Hardware Wallet] > [Keystone Multisig].
    • Choose [Scan] and use the computer's camera to scan the QR code displayed on Keystone. This will successfully set up Keystone 3 Pro as one of the multisig participants.

Importing the Extended Public Key (xPub) of ColdCard as the Other Multisig Participant​

  • On ColdCard:
    • Complete the basic setup, generate/import another set of seed phrase.
    • Insert the microSD card into ColdCard.
    • Navigate to [Settings] > [Multisig Wallets] > [Export XPUB], and the ColdCard's multisig wallet's xPub will be exported to the microSD card.
  • Back to Sparrow:
    • Connect the microSD card to the computer.
    • Select [Keystore 2] > [Airgapped Hardware Wallet] > [Coldcard Multisig].
    • Choose [Import File] and import ColdCard's xPub into Sparrow.
    • After all imports are completed, click [Apply].

Now, you have successfully created a 2/2 multisig wallet with Keystone 3 Pro and ColdCard as the participants!

Next, you need to import the multisig wallet into hardware wallets separately to use the corresponding hardware wallet for signing. Here are the specific steps:

2. Importing the Multisig Wallet into Keystone 3 Pro​

  • On Sparrow Wallet:
    • In the 【Settings】interface, click on the bottom left corner 【Export】,
    • Select 【Keystone Multisig】 and choose "Show QR code".
  • Back to Keystone 3 Pro:
    • Click [Scan] on the homepage and scan the QR code displayed on Sparrow.
    • The information of the multisig wallet, including the co-signer and the corresponding xPub, will be displayed. After confirmation, the 2/2 multisig wallet created on Sparrow has been successfully imported into Keystone 3 Pro.

Importing the Multisig Wallet into ColdCard​

  • On Sparrow Wallet:
    • Export the MultiSig wallet document to the microSD card (the document exported in this path is only for ColdCard).
    • Remove the microSD memory card from the computer and insert it into ColdCard.
    • [Menu] > [Setting] > [Multisig Wallets] > [Import from SD] > Select the document: "Sparrow Multisig-coldcard.txt" > Press [√] to confirm > The multisig wallet is successfully imported into ColdCard.

3. How to Receive BTC with this 2/2 Multisig Wallet​

There are three ways to receive BTC with this 2/2 multisig wallet: through Sparrow, Keystone 3 Pro, or ColdCard. Here's how to receive Bitcoin through Sparrow or Keystone 3 Pro:

Receiving through Sparrow​

  • On Sparrow, click [Receive] on the left, and it will display a receiving address and corresponding QR code.
  • If you need a new address, click [Get Next Address].

Receiving through Keystone 3 Pro​

  • On the Keystone 3 Pro homepage, click the menu icon on the top left to enter 【Wallet Profile】, then select 【Multisig Wallet】and 【Set as Current Wallet】
  • Return to the Keystone 3 Pro homepage and select 【Receive】 to display the corresponding receiving address and QR code.

4. How to Send BTC with this 2/2 Multisig Wallet​

To send BTC, it needs to be done through the software wallet. Here's how to initiate a transaction with Sparrow's 2/2 multisig wallet:

Creating a BTC Transaction on Sparrow​

Click on [Send] > Set the receive address, Label, amount, and fee > Click on [Create Transaction].

Click on [Finalize Transaction for Signing].

Signing with Keystone​

  • On Sparrow, click [Show QR] > Sparrow Wallet displays the unsigned transaction data in QR code format.
  • Scan the QR code displayed by Sparrow with the scanning icon on the Keystone main page.
  • Touch [Sign] > Enter the password > Tap [Confirm] and authorize the transaction. The device will then show the signed transaction data in QR code format.
  • Click [Scan QR] on Sparrow Wallet, then scan the QR code shown on Keystone.

Signing with ColdCard​

  • Insert the microSD card into the PC/Mac.
  • Click [Save PSBT] on Sparrow Wallet and save the file in the root directory of the microSD card.
  • Take out the microSD card from the PC/Mac and insert it into the ColdCard.
  • [Ready To Sign] > Select transaction file.
  • Confirm and export partially signed multisig transaction files to the microSD card.
  • Take out the microSD card from the ColdCard and insert it into your PC/Mac.

Broadcasting on Sparrow​

  • Click [Load PSBT] on Sparrow Wallet, then select and open the signed transaction file.
  • Make sure the Sparrow Wallet has successfully connected to the node.
  • Click [Broadcast Transaction].