The term “trustless” is used to refer to situations or environments in which there is no need to rely on the trustworthiness of anything outside the agreed rules. Trustless is also commonly used to describe trade agreements in which there is no 3rd party involvements.
Removing the need to rely on trust
An Escrow smart contract is a trustless tool because once the funds have been deposited, so long as the counter party holds true to their word there is no need to fear a loss from either party. The receiver of the funds just needs to deliver on their end of the bargain & if they don’t then the provider of the funds will receive them back, the need to trust is minimized to near 0.