Project #02: Peer-to-Peer Escrow with Dispute Resolution

Difficulty: Advanced | Lessons: 1–8

Build an escrow smart contract where a buyer locks funds, a seller delivers, and an independent mediator resolves disputes.

Requirements

1. Escrow Validator

Write an Aiken spending validator with three possible outcomes:

• Release: Buyer signs to release funds to the seller
• Refund: Seller signs to refund funds to the buyer
• Dispute: If neither party acts within a configurable timeout period, the mediator can arbitrate and send funds to either party

2. Withdraw-Zero Shared Validation

Use the withdraw-zero pattern (Lesson 5) to centralize common checks (valid signatures, timeout logic) in a withdrawal validator, reducing script size across the release, refund, and dispute paths.

3. State Tracking

Use an oracle-style datum (inspired by Lesson 8) to track the escrow state on-chain:

• Created: funds locked, awaiting delivery
• Delivered: seller claims delivery, awaiting buyer confirmation
• Resolved: funds released to the appropriate party

4. Contract Tests

Write comprehensive tests covering:

• Successful release by buyer after delivery
• Successful refund by seller before delivery
• Timeout-triggered mediator resolution
• Rejected release without buyer signature
• Rejected dispute before timeout expires

5. Off-Chain Code

Provide runnable scripts for the full lifecycle:

• Create an escrow (lock funds with datum specifying buyer, seller, mediator, timeout)
• Mark as delivered (seller updates state)
• Release funds (buyer confirms)
• Dispute resolution (mediator acts after timeout)

Skills Demonstrated

• Transaction building and multi-party signing (Lessons 1–2)
• Aiken validator with complex redeemer logic (Lesson 3)
• Thorough contract testing (Lesson 4)
• Withdraw-zero pattern for shared validation (Lesson 5)
• Blueprint interpretation (Lesson 6)
• Time-based unlock logic (Lesson 7)
• On-chain state management with datums (Lesson 8)