Escrow is a contractual arrangement where a third party temporarily holds money or property, and disburses it only when a particular condition has been met.

Traditionally, escrow agents would perform this function. Today, smart contracts and programmable assets on blockchain ledgers can perform this function according to pre-set rules. Smart contract escrow services are cheaper and faster.

This is ideal for situations where payment is made - only after a service has been rendered, or a good has been delivered as agreed upon.

Escrow facilitates trust: from hiring a freelancer, to contracting the services of an agency, or even ordering stuff online.

A seller can see that the buyer has sufficient money on hand. At the same time, the buyer is assured that the seller will not disappear with the funds without delivering the goods or services as promised.