In the world of cryptomonies, many alternatives have emerged to exchange our digital assets. From centralized exchanges to free trade options focused on privacy can be found on the order of the day, according to our needs.
However, many traders are more comfortable with dealing more directly with their counterparts. In addition, in the early days of Bitcoin and crypto-currencies, the centralized trading process was quite slow, which paved the way for the emergence of Peer to Peer (P2P) alternatives.
In keeping with the decentralized form of crypto currencies that Bitcoin created, peer-to-peer exchanges allow direct trading between participants, i.e. between the buyer and seller, simulating a normal trading operation.
Paxful’s new P2P protocol integrated into the Infinite cryptobilletera
In other words, you can find buyers or sellers – as the case may be – to exchange your currencies without having to go through a centralized entity that must execute your respective order. Something like going to the pharmacy and buying your medicine directly with the assistant without depending on a third party.
The difference of P2P exchanges with Blockchain technology to the traditional ones of other platforms, is that in this type of systems the direct transfer of cryptomoney from your account to another person’s purse occurs without the need of intermediaries.
Of course, the elimination of intermediaries has its advantages, among which the speed and lower rates stand out. In addition, the business experience is more personalized when dealing directly with other people.
P2P exchange was first introduced by the famous Napster in 1999, which was developed as a file sharing application through central servers between individuals. The same concept now moves to Bitcoin and other altcoins for ’sharing‘ digital assets and content.
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Understanding how it works
Before we can show you the best trades available for P2P trading, it is first necessary to know how these systems work as well as the key differences from traditional cryptomoney trades.
The main reason why P2P exchanges have high adoption is the fact that these platforms match you with the buyer or seller, rather than matching orders from the order book.
Therefore, when the system finds its corresponding purchase and sales order, the software does not process the exchange, but connects it to the buyer/seller, as the case may be. It is always up to you to carry out the deal without interference
The only time a third party is involved in the transaction is when they act as arbitrators during a dispute. Because of this elimination of intermediaries, fees are normally low to pay for the service of P2P platforms, with values even lower than 1 percent.
According to Don Tapscott, the blockchain activated P2P trust for the first time in history
On a security level, digital assets are well protected and secure. Once people trade, assets are blocked by the system until the counterpart confirms payment. This security avoids the possibility of sellers cheating the buyer by recovering their assets after the trust payment has been made.
In short, the operation is quite simple
- a flash loan attack
- testing its marketplace
- $120 million sale
- soon-to-be launched token
- stolen mining machines
exchange platforms use software that connects people who have similar business interests. After matching them up, the system lets them trade freely. To prevent fraud, the software blocks the digital assets until the counterparty confirms receipt of the corresponding payment.
The trading experience on these platforms varies according to the type of exchange, which can be customized from a live chat room between the parties to filters for trading in specific countries and payment options as diverse as digital payments and bank transfers, depending on the user’s needs.