It's great that the Steemit Crypto Academy has resumed and as usual, with insightful and educating subject matters by all professors. This post is actually my participation/ submission to @Sapwood 's course on the topic of P2P Market and/or trading with Tether (USDT) as a case study.
Introduction
There are many ways of trading and/or exchanging crypto-to-crypto or crypto-to-Fiat and P2P is one of those means. P2P is simply an acronym for the word "peer-to-peer" and it entails the trading of cryptocurrency directly between two individuals with the use of an escrow in most cases. However, an escrow is often not needed in a case where you have full trust in the other party. For instance, let's say I want to trade with my brother, I do not need an escrow because we trust each other. So, I simply send him coins and he funds me with Fiat in return. But in the case of P2P trading on an exchange, the exchange (eg Binance) acts as escrow. The essence of an escrow is ensure that no party is being scammed.
With the rise of some unfavorable regulations by certain governments like Nigeria, peer-to-peer trading comes in very handy. Few months ago, the government of Nigeria banned its banks from working directly with crypto exchanges. As a result, it became impossible to deposit or withdraw Naira directly to your bank account. Ever since then, there as been an increase in usage of peer-to-peer trading in Nigeria. Peer-to-peer allows us to still convert our crypto assets to Naira with directly involving the banks. I, for one began using Binance peer-to-peer trading after the ban from the government and it's been quite easy and fast.
Market Making/ Advertising on Binance P2P
Market Making simply entails creating a trade order could be a buy or sell order. For the many times I have used Binance peer-to-peer trading, I have always been a Market Taker; I choose to often go with the available offers. However, placing an order in Binance P2P interface is quite an easy thing to do. Below are the procedures:
- Transfer assets to be traded from "Spot wallet" to "P2P wallet": Assets are usually in a user's spot wallet and to exchange it to any Fiat currency via P2P trading, you move it to your P2P wallet.
Transferring BNB from my Spot Wallet to P2P Wallet
BNB Successfully Transferred
- Depending on whether you want to 'Buy' or 'Sell', click on your choiced option. Having done this, you can decide to sell based on the existing orders or you 'post a new ad' that is, placing your own order/ advert with choiced price, quantity limit and other terms.
- In this case, I am trying to sell my BNB so, I click on "Post New Ad"
and then I click on the 'Sell' option to proceed.
- This allows me to input my sell price, quantity to be sold, minimum and maximum sell limits, payment method (Bank Transfer) and other terms. With this, my advert goes live on the order list.
How to Buy/sell USDT in the P2P Market of Binance for Fiat?
When buying in the Binance P2P market, I simply locate the advert for which I meet all requirements including the minimum/ maximum quantity to buy as well as the payment method. My preferred payment method is usually the bank transfer. Too bad that as at the time of this post, I do not want to purchase USDT so, I will be referring to my previous transactions. Having found such advert;
- I click on the 'Buy' button. There is usually a specified time-frame to complete payment like 15 minutes in most cases. So, once you click the 'Buy" button, the countdown begins.
- Seller's bank account details pops out upon click payment method in the picture below.
- I then transfer the corresponding Naira amount to the seller's account
- Click on payment made
- Seller confirms receipt and releases coins
How Escrow Protection Helps Buyers and Sellers?
Sadly, while I was still new in the crypto space, I was being scammed of my crypto assets while trying to exchange it to Fiat. Back then, there was a Whatsapp group where buyers and sellers met to do exchange. And one of those days, I sent coins to a supposed buyer without engaging someone to be an escrow so, he ended up running away with my assets. By definition, escrow refers to the use of a third party or middleman to hold an asset or funds before they are being transferred from one party to another.
So, escrow helps in avoiding the issue of scams or funds theft. For instance, on Binance P2P market, once a buy order is being initiated, Binance gets hold of the coins till buyer sends funds and seller confirms receipt. Once seller confirms receipt, coins are being released by seller. In a case where the seller refuses to release coins upon receipt of funds, Binance has the power to release the coins where there is an appeal. That way, no party would be taken advantage of so, escrow is very important in P2P trading.
There are about 64 fiat payment options on Binance P2P market and one of such is the NGN which I often use. Others include; CAD, EUR, AED, JPY and others. I have only used NGN to trade in P2P market. For instance, when I sold some USDT days back, I added my payment method as bank transfer and then did input my bank account details. The buyer sent in some NGN and I released the equivalent coins.
Speaking of the minimum amount you can trade P2P Market (USDT), on Binance, there's actually to minimum amount (maybe zero). A user can trade whatever amount owned provided another user agrees to the laid down terms. Meanwhile, I haven't transferred TRC-20 USDT to Huobi before but I have transferred to KuCoin and the transaction fee was just $1 USDT.
P2P cryptocurrency trading is becoming more popular by the day as many persons are coming to its adoption. However, users of P2P markets should be more careful to avoid being robbed. Always confirm with your bank if a buyer has actually sent money because they are fake alerts.
Cc:
@sapwood
All screenshots are from Binance exchange!
Thank you for attending the lecture in Steemit-Crypto-Academy- Season 2 & doing the homework task-1.
It's always better to upload the screenshot of payment/payment voucher in the chatbox, in fact, most of the Advertisers expect that from the buyers. That way you can expect faster release of your asset.
Further, always make sure that the advertiser is reposnive in the chatbox. At times, dispute resolution takes time, that is one of the downside of the P2P Market, But if you trade with a marchant available online, responsive in the chatbox then you won't face any issue.
Nonetheless, escrow will always protect you.
To post an Ad in Binance you need at least 100 USDT in the P2P USDT Market. The min/max limit is up to the Advertiser to define, so a Market Taker can trade with an amount within the limit as defined by the Advertiser.
Feedback/Suggestions:-
Thank you.
Homework Task -1 accomplished.
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Thanks for your review!
This has been noted as well! Like I said, I am a market taker!
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