Basically the escrow is the middle man that keeps both parties safe during the trade.

Say that User A wants to buy an item from User B, but neither want to send first for fear of the other not completing the deal. The escrow steps in and keeps both people safe during the trade. Here is how it works...


-User A sends the Bitcoins to the escrow

-Escrow confirms they have the Bitcoins and tells User B to ship the item

-User A receives the item and tells the escrow to release the Bitcoins to User B


Escrow just holds the funds to make sure both people live up to their end of the deal. Some escrow do charge a % as a fee (it does require some effort so they like paid for it).