The Role of Escrow in P2P Transactions
Escrow reduces counterparty risk and builds trust.
5 min readP2P Education & Safety
The Role of Escrow in P2P Transactions
Escrow mechanisms reduce counterparty risk by ensuring that neither party can default once a transaction is initiated.
Typical escrow flow:
- Trade terms are agreed upon
- Assets are locked in escrow
- Payment is completed through agreed channels
- Escrow releases assets upon confirmation
This model enhances trust in decentralized, user-driven marketplaces.
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