Why P2P exchange is good and better

[Daodex]

The reason why I'm now very fond of P2P exchanges is because no one will know where your money is coming from actually, not even your bank, I don't know this until I give it's a try, after a successful trade here is what I got

From P2P platforms

200$ Credit alert from jeremiah johnson


From centralized platforms

200$ Credit alert from Luno exchange LTD

As you can see, you will get credited like a friend of yours sent you the money, no crypto or exchange involvement, no one knows where your money is coming from

[Yogee]

....As you can see, you will get credited like a friend of yours sent you the money,

That is why it's called P2P in the first place. It's what it means.

no crypto or exchange involvement, no one knows where your money is coming from

You may be mistaking P2P with real decentralized exchanges. There are P2P platforms that collects user information like LocalBitcoins so you can't really say nobody will know where your money is coming from or going to.

[Welsh]

Plus, in most countries these days your suppose to declare your earnings, and investments. Although, most countries don't actually require you to be specific about declaring its actually crypto currencies, if you continue trading on a P2P exchange, and build up a pattern its very likely that they'll be able to make a educated guess you are dealing in cryptocurrencies, especially when it comes to the tax man, and you need to take away the investment, and work out how much you profited.

Its good from a banking sense initially, but even banks monitor their customers behaviours, and like I said after a pattern has been created, it would be fairly easy for them to put two, and two together.

[BIT-BENDER]

I also prefer peer2peer than to use exchange, peer2peer all I have to do is wait for the receiver am sending by crypto-currency to to receive it in their wallet then send back to me Fiat, but exchange will not afford me that because it takes longer time for my local bank to clear up a crypto-currency transaction, and some times they don't work on some weekends.

[Upgrade00]

Its good from a banking sense initially, but even banks monitor their customers behaviours, and like I said after a pattern has been created, it would be fairly easy for them to put two, and two together.

True, Banks can make an educated guess based on the information available, but as it's just a guess, they would be limited from taking legal actions based on it, this is particularly useful in countries with certain restrictions to cryptocurrency trades.
In Nigeria, all accounts involved in cryptocurrency trades are tracked by government agencies and frozen or locked due to the legal situation... P2P platforms protects such users as the banks cannot prove that they were involved in cryptocurrency and as such cannot take definite action.

[JeromeTash]

You can still fall in trouble with p2p exchanges though. The money you could be receiving from your trading partner could have been laundered or stolen. If the bank has been following the transaction trail, you can easily become a suspect of money laundering.
Much as the platforms my protect you from the banks knowing what you exchanged the money for, they can still track the fiat money trail from account to account.

[UserU]

Daodex, P2P is pretty much as easy to be tracked as any centralized exchange.

Here's a scenario from a typical P2P exchange:
1) Jeremiah want to buy 2 BTC
2) Paul offers to sell 2 BTC @ $50,000
3) Jeremiah is shown Paul's personal bank details (Paul Walker - Chase bank - AC No xxxxxx)
4) Jeremiah accesses his Wells Fargo account and sends $50,000 to Paul via instant/ intermediate transfer.
5) Wells Fargo "informs" Chase of an incoming transaction
6) Paul logs into his Chase account and sees the money remitted from Jeremiah
7) Paul releases the BTC to Jeremiah
9) And they lived happily ever after

So as you can see, the potential to trace is as clear as day.

[cryptoaddictchie]

You can still fall in trouble with p2p exchanges though. The money you could be receiving from your trading partner could have been laundered or stolen. If the bank has been following the transaction trail, you can easily become a suspect of money laundering.
Much as the platforms my protect you from the banks knowing what you exchanged the money for, they can still track the fiat money trail from account to account.

Thats harsh actually but possible. Its just a matter of denial and honest response when it comes such question where the funds from your account coming from and what kind of deal you made with the other person.


P2p is always the best way to trade without such fees and minor escrow payment is good deal. I'm always using Binance OP and so far didn't have any trouble.

[CryptopreneurBrainboss]

Daodex, P2P is pretty much as easy to be tracked as any centralized exchange.

It could be tracked but not as easy as having all the details in a transaction. With centralized exchange the details will be clearly spelled out that any authority investigating the issue doesn't have to do any extra work to apprehend the users involved assuming crypto transaction are banned in the country but with P2P some extra works like investigating where the funds are coming from has to be done and probably interrogating both parties involves for finally conclusion to be made.

For extra measure any one using a p2p system for transacting can do their transaction is batches to avoid more attention as cash transfer done in large quantity could attract the authority. At the end you can compare both means of transacting as P2P is more superior.

[UserU]

It could be tracked but not as easy as having all the details in a transaction. With centralized exchange the details will be clearly spelled out that any authority investigating the issue doesn't have to do any extra work to apprehend the users involved assuming crypto transaction are banned in the country but with P2P some extra works like investigating where the funds are coming from has to be done and probably interrogating both parties involves for finally conclusion to be made.

For extra measure any one using a p2p system for transacting can do their transaction is batches to avoid more attention as cash transfer done in large quantity could attract the authority. At the end you can compare both means of transacting as P2P is more superior.

Oh hey, mate

I believe you've heard of Remitano before as it's quite famous in Nigeria. They're a licensed P2P exchange so if authorities were to track, the TX details are pretty much as open as a centralized one (deposit, amount, bank), since both parties' incoming and outgoing transactions are easily traced. Same applies to P2P on centralized exchanges such as Binance. Also remember that KYC is now mandatory to conduct trades.

About batch transfers, it's usually a hit or miss thing. Multiple P2P trades can be pretty frustrating, since you have to always compete with other buyers but if you've a substantial income and have declared them taxes, it should be fine. Or depending on banks, not all tend to inquire unless it involves millions

[joniboini]

Cash might be the only alternative if you really want to make a deal where it's hard to track for authorities, albeit it is time-consuming and has a higher risk if you live in a city with a high crime rate. So either you sacrifice some privacy or go all-in with crypto to pay your daily needs so there's no need to touch fiat.

[o_e_l_e_o]

If the bank has been following the transaction trail, you can easily become a suspect of money laundering.

There are plenty of ways to trade peer to peer without using a bank transfer, which would prevent this from happening. The most obvious way is with simple cash.

So as you can see, the potential to trace is as clear as day.

All they can trace in that situation is that a transfer has taken place between two individuals. They have no idea that bitcoin was involved.

They're a licensed P2P exchange so if authorities were to track, the TX details are pretty much as open as a centralized one (deposit, amount, bank), since both parties' incoming and outgoing transactions are easily traced. Same applies to P2P on centralized exchanges such as Binance. Also remember that KYC is now mandatory to conduct trades.

Any peer to peer exchange which is centralized, requires users to deposit coins to their platform, and requires KYC, is no better than a standard centralized exchange in any way. If you want to trade peer to peer properly, you need to avoid such places and look for truly decentralized platforms with no KYC and which allow you to keep custody of your own coins at all times.

[Oshosondy]

There are plenty of ways to trade peer to peer without using a bank transfer, which would prevent this from happening. The most obvious way is with simple cash.

Cash would have been the best but it can come with its own demerits like physical harm. There are several reports about cash and physical attacks in crypto deals, humans can not be trusted. Using bank this way should not be bad, the bank do not know if the person that send the money bought bitcoin from you.

[qwertyup23]

You can still fall in trouble with p2p exchanges though. The money you could be receiving from your trading partner could have been laundered or stolen. If the bank has been following the transaction trail, you can easily become a suspect of money laundering.
Much as the platforms my protect you from the banks knowing what you exchanged the money for, they can still track the fiat money trail from account to account.

Oh, this is the first time I have encountered this situation. I never thought that once the transaction has been sent, the money that ones receive will be guaranteed no matter what.

Nevertheless, a P2P exchange is definitely better as this eliminates the need for a third-party exchange in holding your money due to a fiduciary relationship created between you and the bank. As long as they have your money, there is always that lingering fear of "what if they run away, etc."

[boyptc]

But if the time comes that your bank starts to think suspicious of your transactions, they may give you a call and will ask you details if your transactions and deposits are very often and coming from various people. But you can have a defense on it by just saying you work with several people and those are payments and services.

Yet, you can't remove that they might somehow come up someday that you're in cryptos unless they dig in to your every transaction and they get a hint where it came from.

[JeromeTash]

Oh, this is the first time I have encountered this situation. I never thought that once the transaction has been sent, the money that ones receive will be guaranteed no matter what.

Nevertheless, a P2P exchange is definitely better as this eliminates the need for a third-party exchange in holding your money due to a fiduciary relationship created between you and the bank. As long as they have your money, there is always that lingering fear of "what if they run away, etc."

I think we should differentiate between custodial and noncustodial p2p exchanges. By the way, there are a number of custodial P2P exchanges that will hold your money which invalidates the notion that people have that a third party is eliminated in p2p trades
Examples;
- Localbitcoins
- Binance p2p
- Paxful
- Kucoin P2p

[FIFA worldcup]

The reason why I'm now very fond of P2P exchanges is because no one will know where your money is coming from actually, not even your bank, I don't know this until I give it's a try, after a successful trade here is what I got

The only thing to take care is when someone is transferring money to your bank account or if you are transferring money to the bank account , do not write anywhere in description as " payment for bitcoin purchase/sell". Some newbie people don't know about this and if they write anything related to bitcoin, the whole advantage of P2P exchange goes in vain as bank will know that your are dealing in crypto.

[o_e_l_e_o]

Cash would have been the best but it can come with its own demerits like physical harm. There are several reports about cash and physical attacks in crypto deals, humans can not be trusted.

True, but again, there are many ways to mitigate this risk. With new trading partners you have never traded with before, keep the volumes small until you have done several trades with this person and built up a bit of trust. Only carry the minimum amount of cash or bitcoin on your person as required for the trade. Always trade in a public place with plenty of other people around. Consider somewhere with good CCTV footage if you want extra security, such as a large transport hub (international airport, train/tram/metro hub, etc.) or large shopping mall. Take a friend or two with you. If legal in your jurisdiction, carry something for self defense such as pepper spray.

[mersal]

The reason why I'm now very fond of P2P exchanges is because no one will know where your money is coming from actually, not even your bank, I don't know this until I give it's a try, after a successful trade here is what I got

From P2P platforms

200$ Credit alert from jeremiah johnson


From centralized platforms

200$ Credit alert from Luno exchange LTD

As you can see, you will get credited like a friend of yours sent you the money, no crypto or exchange involvement, no one knows where your money is coming from

Even though these are the positive side of using peer to peer trading platforms,still you need to know that the negative sides as well.

Let's assume you received $200 from Jeremiah Johnson, but you never know that you actually received from the real Jeremiah or someone accessed without the owner's permission and used to buy btc but when actual Jeremiah came and find out that you received funds so what will happen now?

You will be the one who is going to legal issues and huge penalty and long term jail.

[ice18]

I also started using P2p since it was introduced by Binance and you are right OP you will need not to worry anymore when you cash-out funds from crypto because theres no actual transfer from bitcoin exchanges to banks but rather from someone's bank account and it will not too suspicious for them it will be like a simple fund transfer, P2P is really helpful for crypto people especially when you live in a place where btc is prohibited to use.