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I've read this article: What are "routine escrow mechanisms"?
But I don't understand the bitcoin escrow system.
Can anyone explain me how this escrow system doesn't need a third party ?
Edit : How is solving problems the third party solve in online exchange ?
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Bitcoin escrow schemes that don't require a third party typically don't require a third party because that is one of their design requirements. It's obviously much easier to design an escrow system that does require a third party, so typically you would only design one that didn't if you had no choice.
Makes sense to me. But now what is the point of bitcoin money in an exchange if it doesn't solve the problems the third party solve ? I mean I get why the bitcoin want to get rid of the third party, but if it doesn't solve the problems the third party solve, what is the point ? – Sebastien FERRAND – 2013-04-23T04:35:01.710
@SebastienFERRAND: The point is to provide some of the advantages of escrow without needing a third party. For example, it can ensure the buyer has the funds, ensure the buyer keeps the funds until the time of purchase, impose a cost on the buyer for not releasing the funds, prevent the seller from getting paid before delivering, and so on. – David Schwartz – 2013-04-23T04:36:14.573
"impose a cost on the buyer for not releasing the funds, prevent the seller from getting paid before delivering, and so on" - How bitcoin is providing these services ? As a bitcoin user, all I see is a possibility to instantly send money to someone else in the world. How is it imposing a cost on the buyer if he doesn't release the fund ? and how is it preventing the seller from getting paid before delivering ? Sorry if it looks really silly to you ... – Sebastien FERRAND – 2013-04-23T04:55:12.780
I think I got it. We're talking about hand-to-hand sale, not online sale. Bitcoin alows to do a numeric payment in a real world deal, for example I pay my friend alex for the video game he just put in my hand, and he can check it quickly without a third party. What bitcoin system doesn't do is providing a safe third party free system for online sale, like buying a video to a japanese guy while I'm in France for example. – Sebastien FERRAND – 2013-04-23T07:51:13.430
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2escrow is not a feature of bitcoin Uhh, yes it is. – Nick ODell – 2013-04-23T03:26:31.813
Yeah ok but let's say I know nothing about it; I read bitcoin is a solution to remove the third party from online exchange : How does it solve the problem of proving that the seller sent the merchandise before he gets the money ? I kinda need a new be explanation, as I'm doing my firsts steps on the subject. – Sebastien FERRAND – 2013-04-23T03:54:50.243
See the example. (If you want to do it without a third party, the rule could be that the first party gets the funds if time runs out or it could be that the funds are trapped in escrow forever.)
What is "USD"? US Dollar? – yaobin – 2018-11-11T20:25:51.947
Escrow has several uses, not just having a third party arbiter in a sale. – CodesInChaos – 2013-04-23T10:36:37.977