What is escrow? Six questions to ask before you trust a platform with your money

Escrow is a go-between that holds the buyer's money until the seller has delivered the goods or the work: a way to deal safely with someone you do not know. But not every platform that says "your money is safe until the deal is done" is an escrow you can trust. Before you hand money to any escrow service, ask these six questions.

What escrow actually does

An escrow deal has three stages:

1. Locked. The buyer places the money with the escrow. From that moment, neither side can take it alone.
2. Delivered. The seller, who now knows the money is there, hands over the goods or the work.
3. Released. The buyer checks, and the money reaches the seller.

What an escrow is worth is not in these three stages. It is in the answers it has written down in advance for the day something goes wrong. The six questions below ask for those answers.

Six questions before you hand over money

What exactly is locked?

The money that is locked should be worth something outside that platform too, and be sellable there: USDT from the official contract, for example. If the deal is in a token the platform issued itself, the escrow is only as safe as that token's value, and that value is in the platform's own hands.

The same goes for "rewards". A reward paid in the platform's own token is only a number on a screen until there is somewhere independent to sell it.

In a dispute, who decides, and on what?

A blockchain cannot see whether the laptop reached the buyer, or whether the logo was designed as ordered. Every escrow, including one built on a blockchain, needs someone to judge on the day of a dispute. Ask:

• Who is that judge?
• What do they decide on: the written terms, the messages, the evidence?
• Do they write down the reasons for their decision?
• Which outcomes are possible: pay the seller, refund the buyer, split?

Phrases like "secured on the blockchain" or "monitored by the network" answer none of these.

What happens if one side goes silent?

Ask about two cases. The seller does not deliver by the deadline: does the buyer get the money back? The buyer does not respond after delivery: does the money reach the seller after a set number of days? If these two rules are not written down in advance, the money can stay locked indefinitely, or its fate can depend on whatever the platform decides on the day.

How much is the fee, and who pays it?

The fee should be clear, in numbers, before the deal is created: what percentage, out of whose share, and whether money returned to the buyer comes back in full.

Can the seller see the money is really locked before delivering?

A "paid" screenshot, or a link the buyer sent, is not proof. The seller should see the money locked on the platform itself, in their own account. If you are going to receive USDT directly, check with USDT Check before handing anything over that it is real and has really arrived.

Does it work today, and where are its rules written?

A pre-registration is a promise, not a service. Before you hand over money, check that:

• the service works today, and you can create a real deal;
• its rules are clear and in writing before you sign up;
• neither the platform nor the people running it are on the official sanctions lists. If they are, the money held in it can be frozen, and addresses that dealt with it can run into trouble at exchanges.

Warning signs

• The other side sends you a link to an escrow site you do not know. Fake escrow sites are a common scam; type the escrow's address yourself.
• Partway through, the other side asks you to send the money directly, outside the escrow, "to be quicker".
• The platform promises "completely safe" or "guaranteed", but has no written rules for a dispute.
• Rewards or profit are paid only in the platform's own token.

How Money Harbor's Escrow answers these questions

• What is locked: only USDT actually deposited to your account, from 5 to 50,000 USDT per deal.
• Disputes: the buyer reports the problem and the money stays locked. Money Harbor decides, with written reasons, on the written terms, the deal's messages and both sides' evidence: release to the seller, return to the buyer, or a split. A deal's messages are never edited or deleted. We are not a court, and our decision covers this money only.
• Silence: if the seller does not deliver by the deadline, the buyer takes the money back. If the buyer does nothing within the checking period after delivery is announced, the money is released to the seller automatically. The seller can also return the money to the buyer at any time.
• Fee: 1%, taken only from the seller's share. The buyer pays no fee, and money returned to the buyer comes back in full. Before a deal is created, the form shows what the seller will receive.
• Seeing the lock: the seller is told the moment the money is locked and sees it on the deal's own page. The same page shows whether the other side's identity is verified, how many escrow deals they have completed, and how many disputes were decided against them.
• Sanctions: a deposit from an address frozen by Tether, or from an address on the official sanctions lists, is reviewed before it is credited.
• Rules: written on the Escrow page, before you sign up. Once the second side accepts, the deal is visible to the two of you only and its terms no longer change. Locking money, like withdrawing it, needs full identity verification.

More on the same subject: Is this USDT real?, the "withdrawal fee" scam and USDT sent but not received.

This is educational. It is not investment advice.