I've played through the game a few times, but haven't seen a use for it?
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I believe you earn it in the dungeon at windspear hills, but i don't know where it's used. Is it just used on a door there in the dungeon, and I haven't noticed because I always pick up the key before I need it or something?

<span style="color: lightblue">You haven't noticed because the door can be forced, picked, or knocked. It opens the door that you go through to find Samia (the one who gives you the quest to find the treasure).

after thinking about it, I always seem to go to the right first when i do this dungeon, and so i've always picked up the key before I ever even tried to open that dorr. thanks.