Paxful’s escrow feature aims to ensure a fair trade experience for both parties. Paxful is a peer-to-peer bitcoin marketplace where people can meet and safely trade bitcoin using over 300 payment methods. When a trade starts, the bitcoin from the seller’s wallet is automatically moved into a temporary safe deposit account (escrow) where it will be held until the transaction is complete.
So how does the escrow work?
When a trade starts, the seller’s bitcoin is automatically transferred into our secure escrow.
Note: The amount transferred into the escrow is the trade amount plus escrow fee.
How escrow helps bitcoin buyers: If you as a buyer make the payment but the seller refuses to release your bitcoin, the secure escrow serves as a guarantee. The seller’s bitcoin will stay in escrow until our moderators step in to investigate the situation and award the bitcoin to the deserving party.
How escrow helps bitcoin sellers: Sometimes a buyer may not be able to finalize the payment for the bitcoin. If you’re the seller in this case, then your bitcoin is safely returned back to your wallet.
Once the payment is made and confirmed, the seller can release bitcoin from escrow to the buyer, and this will mark the completion of the trade.