DIGITAL ASSET ESCROW SERVICES
An escrow service is a facility that legally allows a third party to temporarily hold assets or funds on behalf of two other parties in the process of executing a transaction.
Upon completion of the transaction, the assets/funds held by the escrow party will be released in accordance with the instructions provided in the contract. Or, if there is a dispute, the escrow agent can intervene, consider the case and decide in favor of one party – either return the assets to the buyer or transfer them to the seller.
Escrow has long been used in the real estate and stock markets. And now it is becoming an increasingly important security mechanism in the crypto world.
As a result, escrow mechanisms are flourishing both to protect digital assets by storing them in safes or electronic vaults, and to provide secure access to them for potential beneficiaries of such assets.
The conclusion of an escrow agreement effectively protects and guarantees access to specific digital assets and their continuity. Any kind of digital assets can be placed in escrow. They can range from all types of digitized documents (invoices, signatures, wills, medical prescriptions…) to databases, know-how, photographs….
Types of escrow services
Marketplaces consistently offer a built-in escrow service to ensure that all of their online transactions are secure. When a buyer opens a trade with a seller, the total amount of the crypto asset is taken from the seller’s wallet and automatically placed in escrow. Once the seller is able to confirm that the payment has been received, the seller can complete the transaction through an escrow service, usually to the buyer’s wallet on the marketplace.
It is also possible to implement a transaction by choosing a separate escrow agent. When using this option, it is enough to select a reliable service.
Deposit with multiple signatures
Cryptocurrency multi-signature wallets have already proven their popularity as a solution for storing crypto assets where more than one user is required to access the wallet and sign a transaction, and this technology is now being increasingly adopted for escrow services.
Multi-signature escrow wallets provide additional security for both parties to a transaction, reducing the need to rely solely on the honesty of a third party.
Once a buyer creates a new transaction, all three parties—buyer, seller, and agent—must verify and authorize their participation in the transaction before the buyer makes a payment to a multi-signature address.
Decentralized Escrow Services
Decentralized escrow services allow two parties to a transaction to choose an escrow agent that is acceptable to both of them. The buyer’s ETH is first fixed in a smart contract. Then, once the buyer confirms that the seller’s obligations have been fulfilled, the buyer transfers the funds to the seller. The selected escrow agent monitors the transaction and may intervene to resolve disputes, refund the buyer, or transfer funds to the seller, as appropriate:
Smart contract solutions are now emerging that, in some scenarios, completely eliminate the need to rely on an intermediary. Instead, such contracts can be programmed to put funds in escrow and then only perform certain actions when external events change, such as an arbitration decision.
So what is the escrow of digital assets for?
We offer a turnkey solution for buyers and sellers looking to make large digital asset purchases, including digital asset escrow services.
When processed by experts, digital asset transactions can be structured and closed faster than many all-dollar transactions, especially if the real estate transaction involves a foreign buyer.
Finance Business Service specialists will conduct due diligence, help to conclude contracts, draw up sale and purchase agreements, work out the issue with inspectors and perform the full range of pre-sale services, help to deal with taxes, as well as implement the “know your customer” (KYC) policy and verification by anti-money laundering (AML) against the buyer and his or her digital wallet.