There are many ways to trade digital assets, but the most common practice is to use centralized exchanges like Binance. Alternatively, you can transact with fellow digital asset holders and swap assets without needing to track charts and orders. This is what is commonly-called Peer-To-Peer (P2P) trading.
P2P trading is a relatively straightforward process which involves direct transactions between users without the need for a centralized exchange and its order-matching engine to facilitate trades. Sellers have the freedom to set the price and choose how they want to be paid, while buyers have the flexibility to purchase digital assets at their preferred prices from counterparties.
Over the past few years, there has been an uptrend in the volume of P2P trading in many markets due to various advantages such as global accessibility, multiple payment options, zero transaction fees, and the ability to personalize offers. However, there are also risks involved with such deals, such as threats of violence, theft, or scams. In this article, we outline some of the ways to safeguard P2P traders from these threats.
It is essential to acknowledge that all trading activity comes with risks, and P2P is not an exception. The best protection for users of any P2P trading platform is to be aware of the most common scam tactics, so that they can better equip themselves to avoid falling for such scams.
Some of the most common P2P scams include fake customer representativeand receipt scams. Users may fall for fake customer representative scams when scammers forge security alerts regarding one’s account via email and text messages or pretend to be a help representative of the P2P exchange. Users may then be redirected to a site that looks identical to the genuine one, and risk leaving behind important account details or digital asset wallet credentials. Similarly, fake receipt scams are instances where scammers digitally manipulate screenshots to deceive users into believing that they have completed their part of the deal — pressuring them to do the same.
Chargeback frauds have also been a cause for concern. This happens when fraudsters file a chargeback request upon completion of a P2P transaction, and report that they have never authorized the fund transfer. This may result in the initial payment being reversed, resulting in a loss of both the digital assets and money.
On top of being aware of common P2P scams, it is important that users educate themselves on ways to protect themselves while trading peer-to-peer. Some steps users can take include makingit a habit to take screenshots of transactions as proof that they were completed. Screenshots act as primary evidence and can help make your case with the P2P platform when you file an appeal. Other tips include sticking to on-platform communication and verifying completion of transactions before authorising transfers.
When using any P2P platform, users should not only pay attention to the offer, but also learn to assess the reliability of one’s potential counterparty. Binance offers a P2P ranking feature, which quantitatively and qualitatively evaluate each P2P participant’s reliability.Each rating summarizes the user’s history on the site, including their transaction volume, results, and reviews from other users. This allows users to understand a potential counterparty’s track record, behavior, and reliability, resulting in more responsible trading on the P2P marketplace.
If P2P traders are unable to resolve an issue with their counterparty amicably, they can also contact customer support for assistance. On Binance P2P, the customer support team will offer prompt responses to help solve any issue that our users may face while using the platform.
The goal of P2P exchanges should extend beyond merely connecting buyers and sellers, but to also provide them with a layer of protection through securing transactions and reducing the risk of fraud. Buyers and sellers can browse digital assets advertisements and post their own advertisements while enjoying this protection, made possible by feedback and rating systems.
