The growth in the number of cryptocurrency holders and users paved the way for the rise of a lot of bitcoin and crypto exchange platforms. However, not all platforms are trustworthy and reliable enough as a place to perform crypto-related transactions.
Some are at high risk of being subject to fraud, scams, and other technical breaches possible that may compromise their systems and take advantage of every user’s accounts and funds. These sorts of events left adverse effects and impressions on a lot of traders, like loss of confidence to crypto exchanges, among others.
However, it is also important to remember that there are still many cryptocurrency exchanges with strong regulation and security systems. If you are a crypto holder, trader, or investor, read ahead as we’ve listed some significant factors for you to consider when choosing a peer-to-peer (P2P) bitcoin marketplace.
When choosing a platform, it’s crucial to know whether or not it has high levels of security. Security features will not only protect your crypto funds on the platform but also your personal information that you will be providing. This usually includes name, date of birth, address of residence, contact details, and other confidential information. Giving this kind of information to a peer-to-peer bitcoin marketplace that cannot guarantee your security can affect you in the long run if it gets breached.
Since both your financial and private information are shared with a third party, you are allowing others to have indirect access to this information. Among the other things to carefully look out for is whether or not the platform is insured. This will give you an assurance that all or portions of your lost funds will be returned to you if ever a security breach occurs in the company.
Some peer-to-peer bitcoin exchanges even have an added layer of security for their users, such as using two-factor authentication, or 2FA, and confirmation via email for account logins. Another easy way to check a website’s security is through the presence of “HTTPS” in its web address instead of “HTTP.”
There are hundreds of available bitcoin marketplaces today, which makes it very convenient for traders and also crucial as some websites are just created by hackers to deceive users. When choosing a platform, it is vital to check and verify whether a company is legitimate or not. You can start by conducting online research about the company, and scouting its founders, location, and contact information. You can look for useful tools on the Internet, and you can also try reaching the provided contact details by calling the phone number and sending a message via email.
While bitcoin and other digital currencies can reach different parts of the world—even those that are unbanked—there are still some jurisdictions that do not fully embrace the capabilities and uses of this new kind of money just yet. To avoid possible difficulties in trading, it is essential to check what countries are eligible to use certain platforms and which jurisdictions are banned.
Rates and charges
Among the significant factors to consider when choosing a peer-to-peer bitcoin marketplace is its rates and fees for every transaction. This factor varies from one exchange to another. Some platforms charge high prices for buying and selling bitcoin and other cryptocurrencies while some charge extremely low fees. Some exchanges even charge for deposits and withdrawals. This variation is affected by the trading volume of a cryptocurrency on a specific platform.
Trading liquidity and locked in feature
In the financial context, liquidity is defined as “how easily assets can be converted into cash.” Since the transaction involves cryptocurrencies, it is crucial to know whether or not a trading platform has a high liquidity feature. This will give users the assurance that their assets can be converted easily—whenever needed—and that their transactions can be completed without having to wait for a day or more.
Aside from having high liquidity, it is also essential to check if a platform has a locked-in feature, which will ensure crypto sellers that they will receive the price they set whether or not there will be a change in the market price.
These are just some of the many things you can put into consideration when scouting for the right bitcoin marketplace for you. Aside from those mentioned above, you can also check the exchange website’s interface, which should be easy to navigate and use. Another notable feature is having customer support live chat and a responsive email support system, like on Paxful! So, get your computer or phone ready and start looking for the best bitcoin marketplace suitable for your trading needs!