ETH, USDC, or USDT for Escrow

An ETH escrow, a USDC escrow, and a USDT escrow on DeFiEscrow follow the same states and the same approval rule. The asset changes the risk, the fee floor, and the extra approval you sign before a deposit. Each escrow still holds only one of them. You do not pick "a bit of ETH and the rest in USDC" inside a single deal.

Choose from the way the underlying agreement is priced, not from whichever token happens to be in the wallet you opened this morning. Moving tokens onto the right network is a step you schedule. Picking the wrong asset is a risk you carry until release or refund.

ETH: the native asset, and the minimum fee

ETH is sent as the value of the deposit transaction. There is no separate token approval. The wallet must send exactly the required amount. That simplicity is the advantage.

The price is the disadvantage whenever the commercial deal is a dollar amount. Between creation and release, ETH can move. A seller who agreed to "the ETH equivalent of 100,000 dollars" needs a number of ETH written into the escrow at creation. The contract will not reprice it if the market moves. If you lock 30 ETH and ETH rises, the buyer has locked more dollar value than they may have meant to. If it falls, the seller receives less. For a short private trade that was negotiated in ETH, that is the trade. For a house or a company priced in dollars, it is usually an unforced error.

The protocol fee on ETH is 1%, but not less than 0.05 ETH. One percent of 5 ETH is 0.05 ETH, so at or above a 5 ETH payout the percentage is the fee. Below that, the minimum wins. A 1 ETH payout with the depositor paying the fee costs 1.05 ETH to fund, not 1.01 ETH. The fee article has that example in full. Small ETH escrows feel expensive because of the floor. Large ones do not, and they still carry price volatility.

USDC: dollar price, six decimals, an allowance

USDC is the usual choice when the agreement says dollars. The contract's promise is a number of USDC tokens, not a repaired dollar value if the token's market price moves. For closings measured in days or weeks, people use it because that residual risk is smaller than ETH's. Name it anyway if the approval window is long. The property-specific version is buying property with USDC.

USDC uses 6 decimals. The app lets you type whole tokens. A hand-built call that assumes 18 decimals will be wildly wrong. Prefer the review screen.

Before deposit, the party approves the contract to spend USDC. Approve the deposit amount when you can, not an unlimited allowance. Then deposit from the party address. The contract checks that its token balance increased by exactly the required amount. You also need ETH in that wallet for gas. The stablecoin does not pay the network fee.

There is no 0.05 ETH minimum on a USDC escrow. A 1,000 USDC deal is a 10 USDC protocol fee at 1%. Gas is extra and variable.

USDT: the same shape, with an allowance quirk

USDT on Ethereum is also a 6-decimal dollar-tracked token, and the escrow mechanics match USDC: one asset, an allowance, a deposit, gas paid in ETH, no ETH minimum fee. The reason to pick USDT is usually that the counterparty already holds it, or the invoice was written in it. The reason to hesitate is operational. USDT allowances on Ethereum often cannot be changed from one non-zero value to another non-zero value. If an approval fails, set the allowance to zero, confirm that transaction, then approve the amount you need. Wallets surface this as a confusing error. It is a property of the token, not of the escrow.

Confirm you are approving the USDT contract the app selected. A ticker is not an address. The same warning applies to USDC. Lookalikes exist.

USDT and USDC can each move away from a dollar. The escrow will still settle the token amount. If that distinction matters to the size of the deal, it belongs in the risk paragraph of the agreement, not in a hope that the contract will top you up.

How to decide

Use ETH when the deal was negotiated in ETH and both sides want that exposure, and check whether the 0.05 ETH floor dominates the fee. Use USDC or USDT when the deal was negotiated in dollars, you can get that token onto the network the app is using, and you can hold a little ETH for gas. Use a second escrow if a deal truly has two assets. Do not describe one escrow as a conversion. OTC trades are where that mistake is most tempting.

Whichever you pick, the refund path returns that same asset. A buyer who deposited USDC is refunded USDC, not the dollar amount converted at a new price, and not ETH. The asset choice lasts for the life of the escrow.