According to Cointelegraph: Peer-to-peer (P2P) Bitcoin marketplaces play a crucial role in enabling cross-border money transfers, but their future relies on becoming permissionless and unstoppable, says Paxful's Ray Youssef. Youssef, along with Nicolas Gregory and Antoine Riard, is working on CivKit, a P2P marketplace that will utilize Nostr technology and the Lightning network to create a decentralized platform for censorship-resistant and permissionless trading between peers.
Youssef discussed the project, which is aiming for an alpha release by the end of 2023, at the Surfin' Bitcoin conference in Biarritz, France. The CivKit system, as described in the whitepaper co-authored by Youssef, Gregory, and Riard, will use the Nostr protocol for its P2P order book and depend on the Bitcoin network as a source of truth for its "web-of-stakes" market ranking paradigm.
Trades will be locked under Bitcoin contracts to eliminate the need for third-party dispute arbitration, and market nodes will be incentivized by privacy-preserving service credentials backed by BTC payments. The whitepaper states that the market system aims to enable global trade of any kind of item, including fiat currencies, goods, and services.
Youssef believes that P2P marketplaces are popular but considered niche within the Bitcoin ecosystem. He says that P2P trading, or over-the-counter (OTC) trading of money using cryptocurrencies as a clearing layer, is more significant than users might think. The creation of CivKit is partly motivated by concerns about the potential closure of P2P platforms like Binance's and the lack of alternatives for P2P users who rely on these services for cross-border money transfers.
Youssef emphasizes that P2P marketplaces must be built to be "unstoppable" and "permissionless," noting that both Delaware-based Paxful and Finland-registered LocalBitcoins faced closure despite their different locations. P2P exchanges have faced significant regulatory scrutiny and uncertainty in countries like the United States.
