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Understanding what an escrow mean; it is a financial arrangement where a third party holds and regulates payment of the funds required for two parties involved in a given transaction. Simply say; an escrow is a neutral third party that protects the integrity of the transaction. 

Escrow helps make transactions more secure by keeping the payment in a secure escrow account to make sure that all conditions of the agreement between a buyer and a seller are met as overseen by the escrow company, and that all monies are paid to the appropriate parties at the appropriate times.

Benefit of escrow in blockchain

In blockchain all blocks are linked together chronologically and are encrypted, which means the information is securely stored. Being that it is secured and immutable it encourages users to join in on a network and collaborate, which reduces fraud and confusion during communication. This means that escrow on a blockchain is a lot safer and more effective. Hence, it creates open commerce where anyone can transact and trade with anyone across the world while having the funds held on a decentralized system until the conditions of the agreement between the two parties are met.

With blockchain, some of the problems associated with escrow can be eliminated, problems such as;

• Lending problems
• Personal property misunderstandings that arouses when buying a property.
• Errors that occurs in public records, from a property title perspective. Sometimes misspelling names, inverting address numbers, entering inaccurate square footage or getting the lot size wrong.
• Forging a signature or fabricated document in the chain of title for any given property in the public record.
• Entering into a contract with an incapacitated person or an undocumented immigrant without authority to sign.
• Filing claims against one’s property: this is possible in a case of missing will and in the absence of the heirs.
• hacking into the email account of a party to the transaction, and providing fraudulent wiring instructions that end up in the bank account of the thief.

Though it might seem possible that there are several issues with an escrow but with blockchain technology, they can be avoided or rather eliminated.

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