In simple words, a peer-to-peer (P2P) cryptocurrency exchange is a platform where a user can directly exchange cryptocurrency with another user. Unlike the centralized or decentralized exchanges, a P2P exchange allows traders to pick with whom they wish to trade. These platforms enable you to browse through a seller’s list and choose the one that offers the most appropriate payment method without giving up the custody of assets. In contrast to a centralized exchange, a P2P crypto exchange has no single point of failure.
Operating a P2P exchange is pretty simple. A user must register to the site using an email address and does not require identity verification. The users post their buy and sell offers on the platform. Each of these offers is customizable. It means that the user can set a different rate, different methods of payment acceptance, and set the minimum/maximum buy/sell amount.
How does a transaction happen on a P2P exchange?
Once a user initiates a transaction on a peer to peer exchange, the transaction amount is moved to a collateral or escrow contract. Only when the seller confirms that he has received the funds, this escrow amount is released. The escrow acts as a security blanket for the traders.
Any budding crypto entrepreneur can partner with an experienced P2P exchange development company and start a P2P exchange. However, to ensure its success, the following aspects are indispensable.
Well-thought-out business model
The security of traders’ assets is of prime importance. Thus, having an escrow protection mechanism is crucial for the success of a P2P crypto exchange. Apart from that, the features like buy/sell ad display or offline trading support also make an exchange popular.
The flexibility offered by P2P exchanges attracts a lot of spammers. Thus, to enhance the traders’ experience, P2P exchanges must have a reputation management system. The traders can rate each other and this can help other users find a reliable trader.
Multiple Payment options
The most attractive feature of a P2P exchange is the multiple payment options. Some very popular exchanges offer more than 300 versatile payment options. These payment options range from bank transfers, online wallets, and gift cards to cash in person and crypto payments.
Auto Crypto Wallet generation
Once a user signs up with the exchange, he/she should be capable of generating a secure crypto wallet. A multi-signature wallet would promise higher security of assets.
Fast matching engine
Cryptocurrency is a volatile market, thus time means money. An exchange that offers a slow matching engine might put traders to losses. Thus, ensuring a fast trade matching engine is a must during P2P crypto exchange development.
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The P2P exchange development company you choose must ensure that the portal comes with a feature-packed, intuitive admin panel. Some of the most important things to ensure are:
1) The admin panel should be customizable
2) The admin operator must be able to see the website engagement statistics in a chart format
3) The admin panel must come with a monitoring system for reputation management
What are the monetization options for a P2P exchange?
Any crypto entrepreneur can engage with a reliable P2P exchange development company and launch a functional exchange in the market. However, before he does so, he must explore the monetization options. Here are a few ways by which a P2P exchange can make money.
For every trade that uses the exchange platform, the operator can charge a nominal fee. One must be very careful while choosing the trading fee as higher fees could push users away.
An ad gives more exposure to a buyer or seller’s listing. The exchange can help traders with more conversions by offering ad posting options. However, the exchange can charge them a fee for this service.
Dark Pool Trading fee
A user can choose to trade anonymously. However, to enable this, you – as an Admin – can charge some extra fee to the user.
Apart from getting the exchange developed, it’s equally important to market the exchange well. Antier Solutions is your one-stop P2P exchange developmentcompany. While our product development team help you strategize the P2P exchange, our marketing strategists help you reach the desired goals. We provide a white label P2P exchange solution to expedite the deployment, and at the same time, we specialize in building a custom P2P exchange from the ground up.
Schedule a free demo of our white label P2P exchange platform or connect with our subject matter experts to share your needs for custom P2P crypto exchange development.