Some steps to follow for P2P Trades in Crypto Market

We have exchanges to perform crypto transactions including buy and sell. Most of these transactions can be done in cryptocurrency, meaning we can buy and sell using one crypto to another. Many leading exchanges operate worldwide only on crypto-to-crypto format and do not support Fiat currency for many countries. if you want to sell crypto for fiat currency then p2p is your option. Here Peer-to-Peer (P2P) means peer-to-peer where we deal directly with another person and exchange is just a mediator platform. Exchanges do not charge any fee for P2P transactions and this is good because users are not required to pay any brokerage for the transactions done through this model.

This sounds easy that we can perform transactions for buy and sell using peer to peer model but there are some challenges that we need to understand. For example, if I talk about India, then Binance operates in India on crypto to crypto model. if you want to sell crypto for the fiat currency of INR then peer-to-peer is the only option that you can go for. This P2P feature is provided by the Indian exchanges as well because they are struggling with the banking system and this is why this person-to-person is the best option for the traders to get the transactions done seamlessly.

Easy and Convenient

With this model we can sell or buy crypto based on our price. For example, if you are planning to sell your USDT then you know what price is okay for you and you will sell only if that meets your price mark. There are so many orders placed by the users and merchants on the platform with different pricing and probably you will agree on something that you think is OK for you. The entire process is quite easy and it does not take long which is good because anyone can perform and the money is credited to the bank account. The exchanges have created a platform so good that one can buy and sell with ease without going through the complicated process and the fiat currency is used from the bank account without any problem. If you are buying the crypto then you will be able to pay using your bank account and similarly, if you are selling your crypto then you will get the funds credited in your bank account.

Some Precautions to follow

In recent days I have seen multiple articles talking about scams through the peer to peer transactions hence I believe it is very important for us to understand what is the best practise that we need to follow -

• There are two types of people available in this model including the users and merchants. There is a process defined by the exchange to be a merchant and because of this, they are more reliable as they need to follow the compliance defined by the exchange. if the merchant does something wrong then their account is at risk however in the case of individual things can be different. It is always recommended to deal with the merchant instead of the individual but there is no such hard and fast rule because a user can also be reliable. In this case, we need to go with our best judgement.
• Always try to deal with someone with a good completion ratio. It is recommended to go with 98% or above and that too with more positive feedback. If you see that there are more negative feedbacks then it is better to avoid dealing with such a person or even the merchant.
• Some users or the merchant set up some guidelines that we can see by going on their profile so it is the best practice to go through it first before we deal with them to avoid any inconvenience in the process. there have been many incidents in the past where bank accounts are blocked because of reporting. Some users report the bank account and probably these are the new users because reputed buyers will never do such practice as it will impact their business.
• In this model we do not know the person we are dealing with but based on the rating and feedback we can make our decision so proceed only if we feel ok else it is better to look for another person who can be a better option.
• Some buyers offer very high prices as compared to the market and this can be an alarming situation so better to avoid dealing with such buyers.
• Never trade with a third party which means if you are dealing with someone then check the name as you can see in the exchange account and money should also be coming from the same person. If there is a deviation then report it to the exchange because things can be problematic in this scenario.
• always share feedback after the successful transaction because it helps other people to determine whether the buyer is genuine or not and it also helps the platform to be better because based on the feedback exchange also takes action and improves.

Some people try this model to avoid taxation but I believe that is not the right way instead we should pay whatever taxes are applicable. This peer-to-peer model is just to get the transaction done with convenience and that too using the Fiat currency because that option is not available in most of the exchanges. Tax evasion is never the solution through this model and this should not be followed as well because tax is the legal liability that we all are required to fulfil without any gap.

Thank you

Posted Using LeoFinance Alpha