Bitcoin Escrow Explanation

Bitcoin escrow services

Planning to purchase Bitcoin from an untrusted person or company? You can minimize the risks by using Bitcoin escrow services. Let’s find out how these platforms can help you, and which BTC escrow platforms are worth your trust and attention.

Changelly keeps educating the broad public on crypto-related topics. In this article, we will dive into BTC escrow services and talk about the Top 6 of the market.

What is BTC Escrow Service?

A Bitcoin escrow service is an intermediary between the participants of a crypto transaction. It is often used when a person buys goods and services.

How does it work?

When a person decides to buy something for BTC, they send the sum to an escrow service, and it is kept in the system until the goods/services are provided by the seller. Once the strangers finish the transaction, BTC frozen in the escrow system is automatically sent to another party.

Bitcoin escrow services have the following benefits:

  • They guarantee transaction safety for both parties;
  • They charge a moderate commission;
  • The speed of money transfer is more than agreeable: once the buyer gets what they need, the seller will automatically get the profit.

Top 6 Bitcoin Escrow Services

1. BTC Asia

BTC Asia is an escrow service based by Colbert Low whose reputation can be checked on LocalBitcoins (100+ transactions performed there). It’s one of the rare Bitcoin Escrow websites that do not require registration. You can begin an Escrow exchange just by submitting an email and a BTC address. 

The charge is also lower when compared with the escrows mentioned below, set at only 0.05% of the exchange! Note that in case of disputes, BTC Asia is not involved – the issues are handled by third parties. 

The procedure is straightforward, and each stage can be followed by means of an “exchange ID” provided by the platform. They have a USD $500 guarantee which applies in specific cases, for example, hack or theft of server, mistakes of the platform, etc. 

2. IBC Group

This is a blockchain fundraising service that also provides Bitcoin escrow service. Some claim that the platform deals with large transactions, but the reputation of the company is far from being clear. However, traders are content with the service. 

IBC Group is a licensed Escrow organization and adheres to the International KYC strategies, so it might request you to submit some personal information. Although it excludes the possibility of anonymous transactions, such an approach guarantees a higher level of safety.

It provides the purchaser with a predetermined time span to deposit money, and the funds are transferred only when the buyer has inspected the item and is satisfied with its quality.  

The platform leverages Smart Contracts that accelerate the entire procedure and lets the two parties carry out an unlimited number of exchanges with no interference, except if required during disputes. 

Lastly, it features the reputation system for participants to know whether they can trust each other. It charges a 1% exchange fee.

3. Bitrated

Bitrated is rather a multisig service than an escrow platform. Besides, it requires a certain number of signatures for enabling the cryptocurrency transfer. For instance, when a wallet is shared by several people, the majority of them should confirm the transaction for it to be finished. 

To put it simply, Bitrated lets buyers and sellers perform deals with the help of arbitrators. A Bitcoin escrow multisig wallet is owned by 3 people 2 of whom need to provide signatures for funds to be sent. Bitrated itself cannot control your funds since it does not have the private key to the wallet. You can choose the transaction participants by checking their rating – there is a feedback feature provided. 

4. Global Escrow

Global Escrow is Bitcoin Escrow based in Singapore. It requests tracking data if a transaction with physical items is being performed.  Alternatively, some sort of interface is used to confirm the effective relay of the items guaranteed. 

The conditions of purchase can be set by both the seller and the buyer – they define whether a transaction is successful or failed. There’s a 15-day auto-refund period within which the merchant should provide the goods/services, and the buyer has to approve them. 

It additionally permits an “assessment period” which the purchaser needs to activate for every exchange. This period includes the shipping time during which the buyer should verify the quality of arrived goods. 

The stage doesn’t keep any logs, and has only a 1% transaction fee notwithstanding the Bitcoin exchange charge. Enrollment is totally anonymous.

5. Escrow My Bits

Escrow My Bits is one of the crypto escrow companies with a decent choice of Escrow types available:

  • Regular Cryptocurrency Escrow just serves to transfer funds from one individual to another.
  • Regular Escrow pegged to Traditional value 
  • Multisignature Regular Escrow ( the Regular Escrow + multisig). 

When multisig is utilized, the coins can’t be discharged without the endorsement of all the necessary signatures. The situation is the same with “Multisig Escrow pegged to a Fiat value”. This is when Omni or Nubits are utilized to peg the estimation of your coins. 

Escrow My Bits charge is also 1%, and the enrollment is fully anonymous. Additionally, they have cold storage for coins, guaranteeing their security.

6. Carding.WS

Carding.WS is a Forum-Escrow, which implies that it’s basically a Carding Forum with an additional crypto escrow service.

With about 130,000 individuals and 1+ mln threads, the platform is absolutely trustworthy.  There is a serious drawback, however: the fee is relatively high as it is set at 5% of the exchange value. Additionally, it’s not refundable if there is something wrong with the exchange. However, the fee is charged only to regular members – VIP users don’t have to pay it.

There’s somewhat more manual typing and talking when compared with the other robotized Escrows in our list: after all, this is a forum, and you have to communicate and settle things with other members. 

There’s an examination period but administrators make all final decisions. A 5-digit Escrow pin code is provided which can be utilized to follow the status of open Escrow bargains.

By the way, Changelly offers a secure exchange of more than 160 digital assets. Choose floating or fixed rate, for a better exchange experience! Here is an article on exchange rates explaining the difference between the two. 

You can also buy Bitcoin (BTC) and over 160+ crypto assets for fiat money on Changelly with a credit card (Visa or Mastercard), a bank transfer, or via Apple Pay. If you want to trade crypto assets, check out our side project for traders Changelly PRO.

Bottom Line

With the help of Bitcoin escrow websites, you can make purchases and transactions in the Net without being afraid of frauds – such platforms guarantee that BTC will be sent to the seller only when they deliver the goods and services as promised. 

The list of available top Bitcoin escrow services mentioned in our article can be expanded – there is a wide selection of websites. When choosing one, pay attention to its rating and reputation, as well as the fees they charge.

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