Creating an Escrow Smart Contract

An escrow holds funds until conditions are met. In this tutorial, you’ll build a trustless escrow contract where a buyer deposits funds, and the seller receives them only when the buyer confirms delivery.

What You’ll Build

An escrow contract with:

• Buyer deposits tokens into escrow
• Seller can claim after buyer confirms
• Buyer can reclaim if seller doesn’t deliver
• Automatic state tracking

The Contract

contract Escrow {
    address public buyer;
    address public seller;
    uint256 public amount;
    bool public buyerConfirmed;
    bool public completed;

    event Deposited(address indexed buyer, uint256 amount);
    event Confirmed(address indexed buyer);
    event Released(address indexed seller, uint256 amount);
    event Refunded(address indexed buyer, uint256 amount);

    error Unauthorized();
    error AlreadyCompleted();
    error NotConfirmed();
    error NotDeposited();

    modifier onlyBuyer() {
        if (msg.sender != buyer) revert Unauthorized();
        _;
    }

    modifier onlySeller() {
        if (msg.sender != seller) revert Unauthorized();
        _;
    }

    modifier notCompleted() {
        if (completed) revert AlreadyCompleted();
        _;
    }

    constructor(address _seller) {
        buyer = msg.sender;
        seller = _seller;
    }

    function deposit(uint256 _amount) public onlyBuyer notCompleted {
        amount = _amount;
        emit Deposited(msg.sender, _amount);
    }

    function confirm() public onlyBuyer notCompleted {
        if (amount == 0) revert NotDeposited();
        buyerConfirmed = true;
        emit Confirmed(msg.sender);
    }

    function release() public onlySeller notCompleted {
        if (!buyerConfirmed) revert NotConfirmed();
        completed = true;
        emit Released(seller, amount);
    }

    function refund() public onlyBuyer notCompleted {
        if (buyerConfirmed) revert AlreadyCompleted();
        completed = true;
        amount = 0;
        emit Refunded(buyer, amount);
    }
}

Key Patterns

State Machine

The escrow moves through states: Created -> Deposited -> Confirmed -> Released/Refunded. The completed flag and buyerConfirmed flag track the current state.

Multi-Party Authorization

Different functions are restricted to different parties:

• deposit() and confirm() — buyer only
• release() — seller only
• refund() — buyer only, before confirmation

Conditional Execution

The notCompleted modifier prevents double-spending. The release() function checks buyerConfirmed before allowing funds to be released.

Compiling

Open the SolScript Playground, paste the contract, and compile. SolScript generates:

• Separate account structures for escrow state
• PDAs for the escrow instance
• Signer validation matching the buyer/seller addresses

Next Steps

• Add a timeout mechanism so the buyer can reclaim after a deadline
• Add an arbiter role for dispute resolution
• Explore the multisig example for multi-party authorization patterns