P2P transactions (peer-to-peer) are becoming a popular and convenient method of exchange in the cryptocurrency world. This not only helps to reduce transaction fees but also enhances privacy and security for the participating parties. In this article, let’s explore the details of this transaction with Crypto Trading, from how it works, and the outstanding benefits to the basic steps to make safe and effective transactions.
How is P2P transactions understood?
The term “peer-to-peer” describes networks where users can connect and interact directly to exchange data or information, as opposed to the classic “client-server” model of one-way transmission of data that clients request from a central server.
The Bitcoin protocol allows for the transfer of value or money in a decentralized, trustless manner. “Peer-to-peer” trading, or P2P transactions, has become the term for buying and trading cryptocurrencies like Bitcoin, Ethereum, XRP, and many others, directly between two users without the involvement of centralized intermediaries like broker exchanges or market makers.
What is the concept of P2P Crypto trading?
P2P (peer-to-peer) crypto trading is a form of direct cryptocurrency trading between individuals without going through centralized exchanges. In this model, buyers and sellers can interact and make transactions directly with each other through an intermediary platform, usually a P2P exchange. These platforms provide the infrastructure and tools to ensure the safety and reliability of transactions.
In addition, you can refer to scalping Crypto techniques to increase trading efficiency.
Advantages and disadvantages of P2P transactions
Benefits of peer-to-peer trading
- Zero transaction fee
- Flexible payment methods
- Escrow Services
- Reputation system
- Communicate directly
- Decentralization
The challenges of peer-to-peer trading
- Slow transaction
- No AML/KYC
- Lower liquidity
- Limited availability
- Technical expertise
See more: How to “get rich” thanks to crypto trading for trader
Technical analysis for P2P transactions
Technical analysis can be a useful tool to aid in decision-making P2P transactions in the cryptocurrency market. Here are some technical analysis methods you can apply:
Important Terms in P2P Crypto Trading
Before you start trading on Binance P2P, it is important to familiarize yourself with important terminology:
- Creator and recipient
Makers and Takers are the two main groups of Binance P2P users. Makers are users who create and publish ads on the platform. Takers are parties who interact with Maker ads to buy or sell content from existing ads.
- P2P Advertising
Each P2P ad specifies whether the owner wants to buy or sell, the type of crypto asset, the amount of crypto asset, the order limit, the preferred payment method, and other important details about the publisher.
- Order limit
This is the maximum and minimum amount of a crypto asset that another willing trader can buy and sell.
- Funding wallet
This is a special wallet for depositing funds into your Binance account and P2P. Cryptocurrencies bought or sold will be transferred to this wallet. This wallet also contains assets from Binance Pool, Binance Card, Binance Gift card and Binance Pay.
- Payment window
This is the maximum amount of time set by the ad publisher for the buyer/seller to be ready to complete payment. If payment is not completed within the specified time, the ad will be automatically canceled.
How peer-to-peer (P2P) crypto trading works
Peer-to-peer trading starts with someone who wants to trade directly with another user. They go to a platform for P2P transactions and go through the registration and verification procedures. Then place an ad to propose their trade. For example: “I want to buy 0.1 BTC for $3,000”.
Interested sellers accept the offer and agree to the transaction.
To learn more about the trustworthiness and reputation of the other party, buyers and sellers can check user reviews on the P2P platform. After the transaction is completed, both users are encouraged to leave a review about their experience to further strengthen the reputation system and ultimately promote trust in the P2P platform.
Detailed instructions for P2P transactions
P2P trading requires due diligence and risk management skills. Make transactions with reputable trading partners and use security measures to ensure the safety of your transactions.
P2P transactions: Steps to Buy Cryptocurrency on Binance P2P
Step 1: Access Binance P2P
Step 2: Start ordering
If you are buying crypto, you can use Express Zone or P2P.
- Express Zone: Express Zone will automatically connect you with the most suitable users willing to sell their crypto to you.
Step 3: Complete payment
Once you start placing an order, the seller’s payment details will pop up. This way, you can complete the payment using the details they provide.
Crypto trading: Steps to sell cryptocurrency on Binance P2P
Step 1: Access Binance P2P
- Selling your assets on Binance P2P is almost the same as buying. However, in this case, things are reversed.
- Here the advertiser is making the payment so you can sell your crypto to them.
Step 2: Start ordering
Like the buying process, you can sell via Express or P2P Zone.
- Quick Zone: This zone automatically connects you with the best buyers.
Step 3: Confirm payment
See more: OKX: open an OKX account – Reputable crypto exchange
Safety Tips When Making Money From Crypto Binance P2P
While it is not common, it is inevitable that you will encounter problems in one way or another. However, if you do encounter any issues with your order, there is a chat option where you can talk to the other party and resolve things.
Additionally, you can create a complaint to contact Binance customer support regarding any P2P issues.
There is no denying that scammers and bad actors are a part of many things these days. However, your safety is also in your hands by making sure you do not fall victim to scams.
Here are some tips to follow when make money from Crypto using Binance P2P:
- Always confirm that payment has been completed before releasing crypto assets.
- Always check the P2P statistics of the buyer/seller, especially the average release time, completion rate and reviews.
- Do not agree to any agreement in which you release your property before the buyer has paid.
- You cannot create more than two orders at the same time. For sell orders, you can only open one order at a time.
summary
P2P transactions have opened a new potential direction in the field of cryptocurrency, bringing users many benefits in terms of security, low transaction fees, and flexibility in payment methods. Start from the basics, master the principles and strategies, and continuously improve your knowledge through Crypto Trading articles to achieve success in this field.
FAQs
Disadvantages of P2P transactions
- Fraud Risk
- Payment risk
- Price volatility
- The legal framework for P2P in some countries is still unclear.
How to P2P transactions safe?
- Choose a reputable exchange
- Learn more about the seller
- Direct Trading
- Secure Payment
- Store money carefully
Some famous P2P transactions exchanges in UK
- Binance P2P
- Remitano
- LocalBitcoins
- Houbi P2P
- Hubei OTC
