Escrow
A hold on payment until a condition is met. On a market it usually means the platform — not a court — can release or seize the coins.
Escrow is an arrangement where a third party holds payment until agreed conditions are met. On darknet markets the platform itself plays that role: the buyer’s coins sit in a market-controlled wallet until the order is finalized or a dispute is resolved.
Why it matters
Markets operate without courts, contracts, or chargebacks, so escrow is the main substitute for legal enforcement — it gives a buyer leverage against a vendor who never ships, and it structures disputes. Its importance is exactly why its failure modes define market history: because the operator holds the pooled funds, an exit scam is always one decision away, and finalize early terms surrender the protection voluntarily.
Common mistake
Escrow on a market is not escrow in the legal sense. There is no independent, licensed agent — just the same anonymous operator who profits from the trades. Multisig arrangements distribute that custody across several keys but do not remove collusion risk. Mechanics and variants: escrow systems.
Category: Markets