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All the things that have been happening with escrows require that the most trusted ones keep providing their services and/or that new, trusted people start providing escrow services. Having you exiting your escrowing services is pretty bad, IMO.
If people took the time to think about how valuable the service is that well run and trustworthy escrow provides, and then compensated the escrow provider appropriately for the value provided then people like Blazed and myself wouldn't have stopped.
Unfortunately when everything goes smoothly, like it does 99% of the time, nobody even thinks about how much the security and peace of mind were really worth. They tip nothing at all or less than $2 worth of bitcoins.
When I held escrows, all escrow-ed funds were held on single use paper wallets that were generated on a permanently offline computer and that were stored in a secure location. I wrote up custom escrow agreements that laid out exactly how the transaction was expected to progress as well as laying out exactly what would happen in a variety of common situations. If I was going to be unavailable for release at any time, all parties involved were informed ahead of time. I made sure that all parties were provided with multiple ways to contact me if bitcointalk became unavailable (phone number, email address, and frequently a U.S.P.S. mailing address). All of this time and effort for between 0 BTC and 0.01 BTC most of the time. I could earn more running a lemonade stand on a cold day in the middle of nowhere.
In the beginning I did it because I wanted to make it easier for users of the forum that didn't have any way of trusting each other to be able to engage in transactions. I was motivated largely because there weren't many merchants or exchanges available, and if bitcoin was going to be useful, then this forum was going to be where that usefulness was proven. Since then there are several well trusted exchanges and many large public merchants that accept bitcoin as payment. Additionally there were several new escrow providers that I found to be sloppy and uncommunicative, yet users were flocking to them for some reason. At that point it just didn't make sense anymore to spend time and effort for a service that clearly wasn't desired.
This is actually something I've very recently started thinking about and this Master-P issue made me think about it again... Escrow services are extremely undervalued (and underpaid). They're taken for granted by forum members (me included) or they're not used at all (most of those times resulting in scamming). I haven't had many trades here, only needed to use escrow once and I realized it didn't even occur to me at the time of the trade to tip the escrow.
I already knew escrowing wasn't easy and required having a very secure way to store other people's funds and that some escrows on this forum take their work seriously. Unfortunately the people for who they store funds don't take their escrow's work seriously, and think it's only storing a few coins on an address for a few days and then forwarding them after request. That being said, its understandable why trusted people eventually close down their escrow services.
I only have to say that I hope people take this as an example and start seeing escrows in a different way and start being aware of their responsibilities. I surely am seeing everyone offering escrow services differently. We should definitely value people who make our trading activities/lives safer.
Maybe all escrows should start requesting a minimum fee for their services.
To finish off, I do hope people that start offering escrow services take this as an example and make sure customers funds are secure. There are many ways to do it and many tutorials on how to store coins safely offline. And there are also ways to safely backup offline wallets (and having multiple or fragmented backups is essential, as was shown here)
I'm half considering setting up an automated escrow service for signature campaign managers to use to escrow to safeguard payments to campaign members. But seeing you and Blazed both write about how it's all too much hassle, I'm having second thoughts.
Do you think people would use a service like that if there was a small percentage fee to cover expenses?
Such a service would definitely have a use case and I don't doubt people would be willing to pay for it.
