Bitcoin is like cash for the internet. You can send bitcoin from person to person with not much more than an online address and a password. No bank required. That's a great strength of the popular digital currency, but it also makes it very easy to steal. Just ask Gavin Andresen. Two years ago, someone stole five of his bitcoins when they hacked his internet service provider and stole a private key from a computer server he was using.

But Andresen isn't your typical bitcoin user. He's the chief scientist at the Bitcoin Foundation and one of the primary authors of the software that runs bitcoin's peer-to-peer network, and even before his bitcoins were stolen, he had an idea about how to make this kind of theft more difficult. He calls it P2SH – short for "pay-to-script hash" – and it's basically a hack of the protocol that drives the digital currency. It lets you keep your bitcoins safe even if your primary private key is stolen. You see, bitcoin's other great strength is that it's open source software. It can be hacked and extended. And that's what Andresen has done.

With this addition to the bitcoin protocol, you can protect your bitcoins with more than one private key, much like you protect your email or online banking account with multiple login credentials. And you can do this today. A Silicon Valley startup called BitGo has now taken this multiple signature technology and built a new kind of online wallet, one that it believes will make bitcoin a lot more business-friendly – and more secure too.

>With this change, you can protect your bitcoins with more than one private key, much like you protect your email or online banking account with multiple login credentials.

When you sign up for a BitGo wallet, the company creates three keys: one that's stored by the company's servers, one that's encrypted and stored on its servers, and a third that you print out and put somewhere safe. If you forget your password or somehow lose access to one of the other two keys, the third can still keep your bitcoins secure. To spend your bitcoins, you need access to two of these three keys. Typically, you would spend bitcoins by logging into your BitGo account and then using your phone to get access to a second key.

Anyone can use the BitGo wallet, but the company sees a real opportunity in building bank-like services that let companies put corporate controls over their bitcoins. On Tuesday, BitGo introduced a suite of wallet services that let businesses limit how many bitcoins a user can spend without corporate approval, and control digital currency spending in other ways.

It's still very early days for this type of stuff. Many businesses that accept bitcoins will simply convert them into dollars as soon as they get them. But BitGo is taking the long view, believing that more companies will start holding bitcoins and using them to pay employees and suppliers. "A lot of the work being done now by companies like ours is trying to make bitcoin more familiar," says Will O’Brien, BitGo's CEO. "Making it feel like online banking is a starting point. But when you get to advance use cases, there are some things you can do."

With the right tools, bitcoin companies can start doing some of the things that banks do for them nowadays, O'Brien says. This includes paying international suppliers directly – without stomaching high fees "You can set up a debit account that goes between a company and an individual that doesn't go through a bank," O'Brien explains.

Although the company's multiple-signature wallets are new, they're likely to become more commonplace. Another startup, called Authy, is also working on a similar technology. Instead of using bitcoin's P2SH, Authy's technique essentially splits up the bitcoin private key into different parts, so that transactions get approved by several different devices – a mobile phone and an online wallet – before they're approved.

Truth be told, the traditional banking system still has some big advantages when it comes to security. Unlike bitcoin, bank transfers are reversible. And bitcoin's short life is filled with sad tales of online hacks and big, unrecovered bitcoin thefts. But the banking system uses some pretty old and insecure technologies too. Just ask Target, which lost 70 million credit card numbers after being hacked last year. Says Authy founder Daniel Palacio: "This space is moving so fast that. in a year or less, bitcoin will be much more secure than what traditional banking has right now."