What is peer-to-peer trading on Binance P2P?

What is peer-to-peer trading? How to buy and sell cryptocurrency on Binance P2P? What are the advantages and disadvantages of peer-to-peer P2P trading?

Today we will consider a slightly newer version of cryptocurrency trading, namely peer-to-peer trading. In this article, you will learn what P2P or peer-to-peer trading is, and where it is best to trade in a peer-to-peer network.

If you have not yet chosen an exchange for trading cryptocurrencies, then we offer Binance – the most reliable and popular crypto exchange in the world.

What does peer-to-peer mean?

What is Peer-to-Peer Trading?

Peer-to-Peer in translation means "equal to equal". This can be, for example, a general term such as "Business for Business" (B2B), but also "Consumer for Consumer" (C2C). Although P2P is a relatively new concept in the financial world, in fact it has been around for a long time. You may have previously unknowingly performed a peer-to-peer transaction. And if not, then it's time to try.

For example, you and I sit down at the table and talk about the fact that you are a little short of money. You're asking me to lend you $100. I put the $100 on your side of the table, and you put the bill in your wallet. At that time, we were performing a peer-to-peer transaction together. So maybe you are more familiar with peer-to-peer trading than you think.

There are the following peer-to-peer network options:

  • downloading computer files via torrent networks;
  • download music via Kazaa or Limewire;
  • making video calls via Skype or Zoom;
  • sending or receiving WhatsApp messages, etc.

As you can see, the possibilities are endless, and there are many practical examples of peer-to-peer transactions that you could perform yourself. But what about P2P in the financial industry?

You can think of the following concepts as peer-to-peer transactions:

  • borrow money from a friend;
  • exchange sports cards;
  • place a bet;
  • share a Spotify or Netflix account, etc.

Again, you will probably make peer-to-peer transactions more often than you expected. But don't worry, ever since humanity existed, it has been normal to allow equal exchange in one form or another. But what is the connection between peer-to-peer nodes and cryptocurrencies?

What is peer-to-peer trading?

Peer-to-peer trading is an actual trade between two people. On the basis of supply and demand, two people meet together, and after agreeing on the price, the money and the product change hands. Peer-to-peer trading in the cryptocurrency industry is very similar to this.

On the one hand, you have a private cryptocurrency provider who wants to sell at a predetermined price and for this amount places their cryptocurrencies on a platform from which other people can buy cryptocurrencies if they agree with the price.

Conversely, you can also be a seller on the same platform. Since you are still a private person and you are selling to another private person, this is also a peer-to-peer transaction. Therefore, trading cryptocurrencies through a peer-to-peer platform is called "peer-to-peer trading".

Why choose peer-to-peer trading on Binance?

Why Choose Peer-to-Peer Trading on Binance?

There are a number of reasons to choose a large platform such as Binance. The platform is huge, it hosts thousands of traders, and it offers other financial services for the P2P platform. Spot market, margin trading, lending, stacking and savings are just some of the options for Binance peer-to-peer trading.

Precisely because Binance as a platform is so solidly built, working on their peer-to-peer platform is incredibly simple and reliable. Security and ease of use complement the generous offer of various vendors on the Binance P2P platform. Mainly because the platform is visited by a lot of crypto traders, the offer on the platform is relatively large compared to other platforms.

A large number of offers means significant price competition from sellers, which allows you to buy cryptocurrency at favorable prices.

In the video below, Binance shows in 30 seconds how peer-to-peer trading works on Binance.

How to buy on Binance P2P?

Currently, you can purchase six different cryptocurrencies through the Binance P2P platform: Bitcoin (BTC), USD Tether (USDT), Binance USD (BUSD), Binance Coin (BNB), Ethereum (ETH) and DAI.

So, how to buy cryptocurrency through the Binance P2P platform?

Step 1. To buy cryptocurrency through Binance P2P, first go to the Binance P2P website. Then click Buy and you will get a list of options for exchanging cryptocurrencies for fiat.

How to buy cryptocurrency on Binance P2P?

Step 2. You can choose which of the six available cryptocurrencies you want to buy and in which currency you want to pay.

You can see different headings, let's take a quick look at them so you know what they mean:

Binance P2P

  1. Advertisers. In this example, the maker is an "over-the-counter broker". In fact, the title "Advertisers" is nothing more than the name of the provider. The yellow checkmark shows that this seller has been verified by Binance and, therefore, he can be trusted.
  2. Price. This is the selling price at which the maker wants to sell Bitcoin. In this example – $50,129.05 per BTC.
  3. Limit/Available. Here you can see how much BTC is being sold at a particular position. In this example, H50 sells a total of 0.00225308 BTC at a price of $50,129.05 per BTC. You also see the minimum and maximum amount for each transaction. In this case, you will have to spend at least $20 if you want to buy Bitcoin from H50. The maximum amount is $112.94.
  4. Payment. Binance P2P uses a wide range of payment methods. The most common are bank transfers, payment cards, e-wallets Skrill, Neteller, Perfect Money, Advcash, Payeer, QIWI, AliPay and WeChat and others. The latter two payment methods are very popular in China.
  5. Buy BTC. This is the button that you click when you are sure that you want to buy cryptocurrency at the offered price.

Step 3. You enter the amount of fiat currency or bitcoins you want to purchase, and then choose the desired payment method. As soon as you click "Buy", you will proceed to the last stage of the purchase process. You are given a fixed period (often 24 hours) to complete the transfer and inform the seller (via a chat message).

Please note that prices are updated every thirty seconds, keep this in mind and check again if the price matches the price you want to pay before making your choice.

How to sell on Binance P2P?

Selling cryptocurrency through Binance P2P is as easy as buying.

Step 1. In the Binance P2P platform, click Sell and select the combination of cryptocurrency and fiat currency in which you want to receive payment.

How to Sell Cryptocurrency on Binance P2P?

Step 2. Then choose the party to which you would prefer to sell your Bitcoin. This is usually the best price (first), but you may find things like the limit or payment method more important when considering applications.

Step 3. Click "Sell BTC" next to the name you want to sell to. Then you will be taken to this page:

How to Sell Cryptocurrency on Binance P2P?

Step 4. Enter here the amount in fiat currency or the amount of BTC you want to sell. Select your preferred payment method and click the "Sell" button. Congratulations, you have made a deal!

Advantages of peer-to-peer trading on Binance

  • you do not pay transaction costs when trading via P2P;
  • you know who you are buying from and to whom you are selling cryptocurrency;
  • you can buy or sell cryptocurrency in your own currency with a simple transfer from a bank card.

Disadvantages of peer-to-peer trading on Binance

  • prices do not always correspond to market prices;
  • when buying cryptocurrency, there is a processing time.

See also what brokers exist with cryptocurrency trading.

Conclusions

Now you know how to make P2P cryptocurrency transfers through the Binance exchange. It is very simple and convenient. It is not yet known how quickly peer-to-peer networks will take over the crypto industry. What is clear is that with the rise of peer-to-peer lending and peer-to-peer trading, the financial world is rapidly being replaced by decentralized finance (DeFi) solutions such as crypto lending and P2P crypto trading.

Read also the article "Where can I pay with bitcoins?".