How to Safely Use Peer-to-Peer Crypto Platforms

There are several platforms online through which you can trade cryptocurrency and one of these is peer-to-peer platforms. These platforms allow crypto holders to trade between one another without a middleman. The benefit of peer-to-peer platforms is that they offer a wider variety of payment methods than traditional exchanges and can sometimes offer better deals in terms of price as users set their prices for selling and buying.

Some people are reluctant to make use of peer-to-peer platforms because they fear being scammed out of their money or tokens or otherwise being taken advantage of. There is no reason to fear, however, if you conduct your transactions with these safety tips in mind.

Use Reputable Platforms

The very first step to trading securely on a peer-to-peer platform is to make sure that the platform itself is a reputable and secure one. Just like any other type of internet platform, there are both reputable and fraudulent ones. If the platform itself is shady, you can almost guarantee that the individuals who make use of it are not to be trusted.

Before you begin trading, conduct research on the platform you want to use. Visit forums on Reddit and Telegram groups to find information about them. If they have the reputation of being shady or scammy, people who have made use of them would have mentioned this in popular platforms. Similarly, if a platform is reputable, you will find good reviews of them online. Do this diligently before you begin trading.

Seek Out Escrow Services

The biggest issue that many people have with making use of peer-to-peer platforms is that they are concerned that they will send their crypto or fiat currency to another user and not get what they had bargained for in return. Instead, the other user may run off with their funds and not uphold their end of the bargain. This is made even more complex seeing as cryptocurrency transactions cannot be reversed.

The way to get around this is to make sure that the platform you use offers escrow services. Escrow services mean that the funds of both parties will be held by an independent third party and will only be released when both parties hold up their ends of the bargain. Bitcoin Global, for example, holds cryptocurrency in escrow until the seller has received their payment. Should this requirement not be met, a member of staff will intervene.

Seek Out Reputable Traders

Even on the most reputable and safe platforms, some rogue actors are out to scam others out of their money. As such, it is best to navigate these platforms with care and avoid them. Many peer-to-peer exchanges offer ratings of sellers which increase based on the more successful sales they carry out and the more positive reviews they receive from other users.

When searching through offers to use on a peer-to-peer site, look for any signs of feedback on a buyer or seller. Bitcoin Global, for example, shows a user’s number of confirmed trades, feedback scores, and feedback given from other users they have interacted with.

This way, you can see if they have had a record of successful dealing or if they have scammed others in the past. If possible, message other users who have left reviews of the trader to confirm their experiences. Conduct your due diligence before you reach out and deal with any other user. Also, once you have completed your trade, make sure to leave feedback, both good and bad, to help other users who may want to deal with them.

Follow All Platform Rules

Peer-to-peer crypto trading platforms are aware of the issues that their users sometimes face and many take steps to address these issues. One of the ways they do this is by creating rules for engaging on the platform or by creating a guide for safe use of their site. This might include steps to follow when choosing other users to transact business with, the proper steps for sending funds, and how to identify scam users. Some platforms also have lists of fraudulent users who have been reported to be misusing the platform and advise others to avoid them.

Before you even begin trading, read through the site rules or guide, and make sure that you abide by it. If you have any concerns or are unsure about anything, contact the platform and make sure you clarify them. Some peer-to-peer platforms also have forums where users discuss issues they have faced when trading including technical issues, scams, and so on. Get involved with the community and don’t hesitate to ask questions if you have concerns.

Start Small

Peer-to-peer crypto trading platforms come with some inherent level of risk of having your funds lost to fraudulent traders. When you first begin, you might not be as adept at spotting this, so it is best to start small.

When you first sign up, trade in small amounts until you properly understand the platform and how to make use of it. Then, slowly work your way up with bigger amounts. The benefit of doing this is that should you make any mistakes or lose any money, it will be a small amount rather than one that is very large.

Err on The Side of Caution

One of the most peculiar things about cryptocurrency transactions is that they are irreversible. As such, you must err on the side of caution whenever you are conducting transactions. If you have any concerns or doubts regarding a potential trade or deal, err on the side of caution and do not send any funds.

It is better that you take your time before you conduct your trade rather than deal with the regret of having lost your funds forever.

Conclusion

Despite the apprehensions and doubts that some people have towards peer-to-peer platforms, they can be very rewarding places to conduct business. Follow the above steps to ensure safe transactions on these sites.