What is “escrow”?

kofi fobil
Sep 3, 2018 · 4 min read

You know how when you make a bet with someone, someone else holds the money until the bet is resolved so both parties know they will get paid if they win?

That’s escrow

Escrow is a legal concept in which a financial instrument or an asset is held by a third party on behalf of two other parties that are in the process of completing a transaction. The funds or assets are held by the escrow agent until it receives the appropriate instructions or until predetermined contractual obligations have been fulfilled. Money, securities, funds, and other assets can all be held in escrow.

When parties are in the process of completing a transaction, there may come a time when it is only interesting to move forward for one party if it knows with absolute certainty that the other party will be able to fulfill its obligations. This is where the use of escrow comes into play.

For example, a company selling goods internationally wants to be certain that it will get paid when the goods reach their destination. Conversely, the buyer wants to pay for the goods only if they arrive in good condition. The buyer can place the funds in escrow with an agent and give irrevocable instructions to disburse them to the seller once the goods arrive. This way, both parties are safe, and the transaction can proceed.

Escrow transactions are also frequent in the real estate market and the stock market.

Some people try to avoid Escrow because the money usually goes through your bank account but now there are options for Global money transfers that are way cheaper and faster.

Let me introduce you to the escrow block of the 4th generation Blockchain.

CUBECHAIN ESCROW BLOCK

Escrow transactions in the Cube Chain becomes unavailable immediately in the wallet of the receiver, even if the transaction is signed for and approved for use. General transactions are recorded in 24 separate data blocks and are recorded in an escrow block during the escrow transaction. Approval encryption can be made and traded in a virtual currency escrow. The approval encryption key allows the sender and receiver to process approvals using the encryption key. At this time, the approved encryption key is automatically generated and sent by the receiver. As for the authorization technique of the encryption key, only the sender or the receiver can process it for approval. Additionally, only the sender and receiver can accept it. In addition, there is an automatic approval system after a certain period. If key fails to be released the key will be automatically approved after that period. If automatic approval is granted, the sender will accept it and the escrow status will be maintained until the transaction is allowed by the receiver. The receiver can then request to keep the deal or contract because he/she hasn’t cancelled the transaction. In order for the receiver to be allowed to accept the key, and therefore receive payment, the receiver must deliver the approval key via a communication technique, such as e-mail or messenger, to the sender. 10 In existing escrow transactions, a broker plays the role of a medium for the transaction between the dealers. The escrow block has an escrow function and there is no broker. Although third parties can play an intermediate role as in the existing technique depending on the implementation of the service, there are many special features that escrow introduces through direct inter-party transactions. Escrow blocks could be a revolutionary way to make transactions simple and safe, not only for online shopping malls and open markets, but also for direct transactions between individuals. The double authorization data system is introduced in the escrow block to store data. The general data is recorded as one of the 24 data blocks, but the escrow data is stored and managed separately. The escrow data is re-written as general data at the time of the double authorization. The term double authorization data system refers to the technique where an encryption key must be additionally issued and approved apart from the electronic signature that is made during transactions by using general blockchain technology. This technique, using the escrow block, the payment is not immediately available in the receiver’s wallet, even if the transaction is signed for. This may provide a function to protect transactions between trading parties, other than in the form of current escrow transactions mediated by a third party. In addition, the escrow block can be used by the owner to protect the data with a password, instead of using the data as an open format. Only users who know the password and only those with the encryption key can see the data.

For more information:

Official Site : http://cubechain.io

YouTube : https://www.youtube.com/channel/UCYDEC2HP8oVRXuKsAeUtrLA

Telegram : https://t.me/cubechain

Facebook : https://www.facebook.com/cubechain

Twitter : https://www.twitter.com/cube_chain

Github: https://github.com/cubechainofficial/CubeChain

Medium: https://medium.com/@cubechainio

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