Token escrow

For years an escrow could hold only XRP. Since February 2026 it can also hold tokens: trust line tokens and Multi-Purpose Tokens (MPTs). A stablecoin payment can now wait in escrow the same way XRP can.

Tokens have an issuer, and the issuer has a say. That adds rules.

• The issuer must allow it. Each issuer decides whether its token can be escrowed. If it has not switched this on, the escrow fails.
• An end date is required. Every token escrow needs an expiration, so tokens cannot be locked forever.
• Issuers cannot escrow their own token. An issuer can be the recipient of one.
• Approved-holder tokens stay approved-only. If the token needs the issuer's approval to hold, the sender must be approved to create the escrow. The recipient must be approved before it can be finished.
• A hard freeze blocks delivery. If the recipient is deep frozen, the escrow cannot finish. It can still be canceled once it expires, and the tokens go back to the sender.

Some tokens charge a transfer fee. For an escrow, the fee is fixed on the day the escrow is made. If the issuer changes its fee later, the escrow still uses the old one. The recipient knows in advance what will arrive.

The TokenEscrow amendment (XLS-85) was enabled on mainnet on 2026-02-12. It changes EscrowCreate, EscrowFinish and EscrowCancel to accept token amounts.

Issuer opt-in

The trust line flag is not permanent. If the issuer turns it off, new escrows fail. Existing ones can still be finished or canceled.

Create. CancelAfter is mandatory for token escrows. Further failures:

• tecNO_AUTH: the token needs authorization and the sender lacks it.
• tecFROZEN: the token is frozen or locked for the sender.
• tecUNFUNDED: not enough spendable balance.

Where the tokens sit. For MPTs, the amount leaves the sender's balance and is counted in LockedAmount on the sender's MPToken and on the MPTokenIssuance. OutstandingAmount does not change.

Transfer fee. The Escrow entry stores TransferRate: the issuer's TransferRate for a trust line token, or TransferFee for an MPT, as it stood at creation. Settlement uses that stored value.

Finish

• A missing trust line or MPToken for the recipient can be created automatically when authorization is not required. The recipient then needs the reserve for it, or the result is tecINSUFFICIENT_RESERVE or tecNO_LINE_INSUF_RESERVE.
• tecNO_AUTH if the recipient needs authorization and lacks it. It cannot be granted during the finish.
• tecFROZEN if the recipient is deep frozen (trust line token) or the token is locked (MPT).

Freeze matrix

Cancel returns tokens to the sender. If the token needs authorization, the sender must still be authorized to receive them back.

Related: Multi-Purpose Tokens, Freeze, Deep Freeze and Clawback, Stablecoins on the XRPL.