An Escrow is an arrangement for a third party to hold the assets of a transaction temporarily. The assets are kept in a third-party account and are only released when all terms of the agreement have been met. The use of an escrow account in a transaction adds a degree of safety for both parties.

The main purpose of an escrow is to ensure that everybody sticks to their end of the bargain. It can be seen as a mediator of the transaction. It asserts that the transfer of assets only happens when all the obligations of the transaction have been met.