It is indeed somehow like a deposit. But it's better, richer and more flexible.

On the one hand, if Alice wants to rent Bob's flat, and Alice simple deposits $1,000 to him, she has to be concerned about the possibility that Bob keeps the deposit for himself and never pays back. If, instead, they do a 2-of-2, Alice doesn't need to worry herself about that. But Bob still has $1K of power over Alice.

And then you can have both parties putting part of the funds, you can jump to 2-of-3 and include arbiters, etc.

I think anyone who is looking at building businesses that live outside of the fiat system, both financially and legally, would probably appreciate the options and security that this kind of arrangements would provide.