The concept of Locked funds is really simple. Every Order that is processed deducts funds from your Account. However, Bulk Orders (like Bulk Transfer of Domain Names from another Registrar to SitHost.com) typically take some time to get processed. The process of executing such Orders consists of several steps. There is a chance that certain steps may fail and the Orders do not get processed. Therefore, we lock the requisite funds in your account when the Order is being processed.
Basically this means that when you pay us for a Bulk Order, we do not utilise those funds immediately. We lock the funds and begin processing the Order, in order to prevent the possibility of your account not having funds, at that time when the Order is processed successfully. If the processing fails then we release the lock and the funds are again available in your Account for you to use for any other service.
There might also be cases where a Bulk Order would not be entirely successful. For such an eventuality, we would lock funds required for a successful completion of the Request, in the beginning. When the Order is completed, we would deduct only the amount for which the associated Order was successful, and the remainder of the Locked funds would be released and available once again in your Debit Account.
For instance, say you placed a Bulk Registration Order for 10 Domain Names. The requisite funds for this Order would be Locked, and the Order would be executed. Now, if only 6 of these Domain Names were registered, and 4 were unavailable for registration, then the charges for Registration of 6 Domain Names would only be deducted from your Account, and the Lock on the rest of the funds would be released.
You can check out the complete list of Locked funds for all your Orders which are currently in processing by clicking on My Billing -> Locked Funds. This list shows you the Orders for which funds have been locked from your account, and the quantum of funds locked for that Order.