You might not be aware that Binance has a P2P (peer-to-peer) exchange that allows users to directly trade cryptocurrency with one another.
P2P trading is not new in the cryptocurrency space. It has been around since the early days of Bitcoin, when Binance didn’t even exist yet. It provided a method for accessing the cryptocurrency market in its early days.
Today, P2P trading provides another method for accessing the cryptocurrency market. It also provides a path for users to start their own businesses.
This article will cover everything you need to know about Peer-to-peer transactions and how the Binance P2P platform works.
What is P2P trading?
Generally, the most common method of trading cryptocurrency is taken on centralized exchanges. These exchanges allow users to open orders to trade cryptocurrency at specific prices. Users can seamlessly set orders or enter at the current price to obtain cryptocurrency.
Before centralized exchanges, trading cryptocurrency wasn’t easy. There weren’t many people in the space back then, and people weren’t so easily trusting centralized exchanges after the Mt.Gox collapse. So the only way traders could buy or sell Bitcoin securely at that time was by meeting up with other cryptocurrency enthusiasts to conduct trades in person for cash. This is what is known as peer-to-peer (P2P) trading.
Traders would meet up together to exchange cryptocurrency for cash, physical goods, or other cryptos in P2P. transactions
The users would typically find each other through online P2P websites and forums. They would also network at cryptocurrency events and meetups to find like-minded traders. There was no centralized exchange involved in the transaction. Instead, the transaction occurred straight between two individuals with no oversight.
What is Binance P2P:
Binance P2P is a platform that enables P2P Bitcoin (and other cryptos) transactions using local currencies.
Built in late 2018, Binance P2P is the P2P arm of the number one cryptocurrency exchange – Binance. Since launching, the P2P platform for Binance has now processed a whopping $7 billion worth of transactions through 3.8 million orders.
During popular trading seasons, the daily volumes would reach as high as $54 million; all transacted through the P2P method without a centralized exchange involved.
The growth of P2P trading on Binance has been truly exponential after exploding by more than 7x from 2019 to 2020.
Binance P2P allows people to become their own local cryptocurrency exchanges, and there are now well over 2000 P2P merchants on the platform.
Merchants on Binance P2P can make a profit by providing competitive prices relative to other traders or by providing versatile payment methods to access a larger audience to transact with.
What are the features of Binance P2P?
Currently, Binance P2P supports buying and selling for BTC, ETH, BNB, BUSD, DAI, and USDT. Users can buy or sell these cryptocurrencies using 55 local currencies through over 150 payment channels worldwide.
A great feature of the platform is the feeless advertising posts. Binance P2P users can post trade advertisements to buy and sell crypto using fiat with zero advertising fees. Prior to this feature, users could only buy and sell crypto from verified merchants on the platform. Now, anybody can start their own P2P business using the platform.
Another great feature of the platform is the Cash-in-person Transactions. These allow users to buy and sell crypto using cash-in-person as an offline payment method. As a layer of security, only qualified merchants can create and post adverts to use the cash-in-person payment method.
Lastly, Binance recently added a Comment Feature on the P2P platform in January 2021. This allows users to review trading partners on the Binance mobile app after completing P2P orders on the exchange. In addition, this provides feedback for other users interested in making any future trades with the merchant.
What are the Advantages of Binance P2P?
Like anything Binance releases, the Binance P2P stands head and shoulders above the competition in the P2P space.
First, the Binance P2P platform has absolutely zero fees. Unlike other P2P platforms, Binance P2P does not take a cut of the trade. This means that buyers and sellers get exactly what they pay for without having to factor in the cost of fees during the exchange.
The platform also offers multiple payment methods that the competition cannot rival. With more than 150 payment methods available, you can choose your favorite way to send or receive money for your trades.
Furthermore, funds are held in an escrow during pending transactions on Binance P2P. This is to prevent theft or scams by adding a mechanism that stops malicious actors from stealing funds without upholding their end of the trade.
The platform also offers a very high level of liquidity for traders. Since launching, Binance P2P has already processed over $7 billion worth of trades. So the platform is certainly the best P2P exchange to fill large orders that need high liquidity.
Because merchants have a high standard to live up to on Binance P2P, the platform has high completion rates. Therefore, they must complete transactions as quickly as possible and ensure a high customer satisfaction rate to remain a merchant on the P2P exchange.
Lastly, Binance P2P offers extremely fast transactions. P2P merchants on the platform can set their transaction timers to as fast as 15 minutes. This means that you can complete a secure and fast P2P trade with selected merchants in 15 minutes or less.
How to Start Using Binance P2P?
First, you need to head over to Binance P2P and register an account. If you already have a Binance account for the main exchange, you can use this to access the Binance P2P exchange.
Once registered, you must also complete verification. If you intend to become a merchant on the P2P exchange, you will have to undergo a screening process to provide security for the ecosystem. This is an excellent feature for the platform as it helps the users remain safe and prevents malicious actors from quickly accessing the system.
Once the verification is complete, you can head straight to the dashboard and look for advertisements that suit your need, depending on whether you want to buy or sell.
Trading on Binance P2P provides an option for those not wanting to go through a centralized exchange to trade cryptocurrency. With over 150 different payment methods, Binance P2P opens up the cryptocurrency world to traders that might not be able to register for centralized exchanges in their own jurisdictions due to regulatory restrictions.
In addition to this, Binance P2P allows users to become exchanges themselves. As a result, traders with large volumes can easily set up as a merchant on the platform to offer competitive rates and make a profit on every transaction made.
David is a crypto enthusiast and an expert in personal finance. He has created numerous publications for different platforms. He loves to explore new things, and that’s how he discovered blockchain in the first place.