Crypto glossary
Partially signed Bitcoin transaction (PSBT)
A PSBT (BIP 174) is a standard format that carries an unsigned or partly signed Bitcoin transaction between wallets and devices until it is complete.
Before PSBT, every wallet passed incomplete transactions around in its own format, which made hardware wallets and multisig awkward to combine. BIP 174, adopted in 2017, defined a common container. It holds the transaction plus everything a signer needs to check it: which outputs are being spent and their amounts, scripts, key derivation paths and any signatures already added. A later version, BIP 370, made the format more flexible.
The workflow has clear roles. A creator builds the PSBT, often in a watch-only wallet; signers such as hardware or air-gapped devices add their signatures; a finalizer assembles them; and the result is extracted and broadcast. This is what lets a 2-of-3 multisig use devices from different manufacturers, or collaborative transactions combine inputs from several people.
A PSBT is not a payment by itself and can sit unsigned indefinitely. Signers must still verify amounts and addresses on their own screen, because a compromised computer can create a misleading PSBT. Sharing one also reveals details about your wallet's addresses and balances to whoever sees it.
Example
A company's treasurer creates a PSBT in desktop software, sends the file to two co-signers who sign with their hardware wallets, and broadcasts the transaction once both signatures are in.