What exactly is Escrow, how do I use it and what are the risks/drawbacks?

[Pono]

Hi all,

so I'm selling a lot of crypto hardware for a large sum of money and shipping it from Germany to another country in Europe. Seller seems like an honest guy and he'd like to pay via Escrow. I've never done any deals via Escrow and to be honest, I'm not entirely sure how it works. Tried some YT videos on this topic but they are mostly about real estate and the whole process seems to me as a bit too complicated. Do I need an Escrow agent? Who is he? How do I find one? What happens when I send my hardware to the buyer and he refuses to pay and never sends it back?

If there's anyone here on this forum who did some deals via Escrow and could shed some light on that topic I would be very thankful.

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[Potato Chips]

It acts as a middle man to ensure no fraud will take place. But don't get your hopes up too much cause there's no way to guarantee safety 100% but it's still way better than having none.

The process is generally like this: (Depends on what terms both parties agreed)

>buyer sends payment to escrow
>escrow confirms
>seller sends the "product"
>buyer confirms
>escrow release the funds to seller

What happens when I send my hardware to the buyer and he refuses to pay and never sends it back?

That's why there's an escrow in the middle! If that happens they can just send the funds to you.

Do I need an Escrow agent? Who is he? How do I find one?

Imo if you're transacting with a stranger you barely knew, yes

Who is he? How do I find one?

We have escrow agents here in the forum, I would recommend using them! Some have been here for years and has transacted with over hundreds/thou of btc.

⛓LIST⛓ BitcoinTalk's Escrow Providers: Ranking & Blacklist ☠ Avoid Scammers ☠

Choose a reputable escrow, do your own research, make sure you are not transacting with a fake one, always ask for a sign message.

[buwaytress]

I could add here that there are also commercial escrow services outside of this forum, where you engage a company rather than a person to arbitrate the deal and determine if terms are met, and when the funds are released. Probably not for amounts you handle, but an option nevertheless. I personally trust the big escrows on this forum but can understand that reputation means little outside of bitcointalk.

If you don't like trusting people or services, there are also smart contract escrows for crypto, but you probably want to test them out before using (check out localethereum for open source), I have only ever used it for 1 non-Bitcoin blockchain (which was a DAG even not even blockchain). I'm still on a search for a Bitcoin smart contract escrow - Google's pointed towards Rootstock and others but none seem to be in popular use enough to give me confidence.

[Zadicar]

If there's anyone here on this forum who did some deals via Escrow and could shed some light on that topic I would be very thankful.

"Escrow" means the middle-man of your transaction which means he would be the one to held up with the funds until the product or item is already being sent out to the buyer
and that time the cash being held by escrow would be released to the seller itself and thats how the system works. Since you are delivering the item (seller) then there would always
be a policy on pay first before sending because on that kind of arrangement it would be too hard if the receiver wont tell that he recieved the item and tell the escrow to refund the funds.
There would be a tendency like that and it would be much hassle to make verification on carrier on where that package goes. Better to have payment first policy or COD (cash on delivery) method.

[pragna]

Escrows are middle man and trusted partner in ICOs. When investors look in a campaign for invest they look into Escrow.Its like a central bank of a country that private bank deposit a fixed amount of money as if that private bank fall, clients can get a lam sum amount against their holding from that deposit. When an ICO launch some amount are stored to a third party(Escrow) that if that ICO fails investors can get lam sum amount form Escrow.

[LTU_btc]

Escrows are middle man and trusted partner in ICOs. When investors look in a campaign for invest they look into Escrow.Its like a central bank of a country that private bank deposit a fixed amount of money as if that private bank fall, clients can get a lam sum amount against their holding from that deposit. When an ICO launch some amount are stored to a third party(Escrow) that if that ICO fails investors can get lam sum amount form Escrow.

OP aren't asking how escrow are used in ICO's, please read his post more carefully.
Users above explained about escrows pretty well. Just one thing to add. If buyer aren't using Bitcointalk, it's likely that he wont agree to use escrow agents from this forum because he don't know anything about them and he can't trust in people who he see for the first time. User above said well - reputations means almost nothing outside this forum.