A digital signature is a complex and secure version of your handwritten signature. It’s a cryptographic mechanism used for verifying digital data. In cryptocurrencies, a digital signature often consists of three basics: hashing, signing, and verifying.
It’s used in crypto transactions as a private key that gives you access to funds stored in a wallet. Technically, when coins are sent to an address, the recipient should provide both the private key (signature) and the public key (wallet address). Your digital signature shows that you know the private key of the wallet address.