How to Choose and Rank a Trustworthy Counterparty for P2P Trading
Main Takeaways
It’s important when P2P trading to find the right counterparty to trade with.
Binance’s P2P rating system evaluates a user’s role, completion rate (%), and reviews from other users.
Aside from helping users choose a suitable counterparty, the rating system also incentivizes merchants to offer reliable and competitive services.
Ensure you’re making a responsible decision when choosing who to trade with on Binance’s P2P marketplace.
When using any P2P trading platform — even Binance P2P — you must assess your potential counterparty’s reliability. But how do you determine this and identify possible risks? One option is to rely on the trader’s reputation on your platform. However, reputation is a relatively qualitative concept, and ranking many users by reliability may be challenging.
Let's say you want to buy a cryptocurrency and find a tempting offer on a P2P site that’s strikingly different in price from others. Is this an attempt to deceive or a genuine listing from a trader who simply has a promotional offer on at the moment?
Understanding what’s on offer and who’s offering it is important. Of course, you can never know for sure whom you’re dealing with in the online world. Binance P2P, however, makes the job a little easier with its internal user rating system.
Binance P2P Ranking: A Trustworthiness Tool
With Binance’s P2P ranking feature, you can quantitatively and qualitatively evaluate each P2P participant’s reliability. Here, we’ve “digitized” each user’s reputation and obtained a quantitative reliability measurement.
Each rating summarizes the user's history on the site, including their transaction volume, results, and reviews from other users. This allows users to quickly understand a potential counterparty's track record, behavior, and reliability. It’s important to note that a rating is in no way a guarantee of a user’s reliability; it’s simply meant to be a useful tool to consider before entering transactions.
How Binance's P2P Ranking System Works
Binance's P2P ranking system ranks P2P counterparties by specific aspects, their main characteristics, and how they work. The rating and reliability of a user consists of the following indicators:
Completion Rate (%) - The ratio of successfully completed deals to all received deals, expressed as a percentage.
Average release time
Average pay time
The number of counterparties they’ve traded with.
Reviews from other users.
User status
The Completion Rate
Here’s an example of how the completion rate works. If a vendor has received two orders but completed only one, the rate of completion would be 50%. Using this criterion, you can choose and evaluate a counterparty’s reliability.
The higher a user’s transaction completion rate, the more often their orders are successfully completed. Conversely, you might be cautious of traders with low deal completion rate.
An order doesn’t count as being fulfilled when:
The buyer cancels the order.
The order expires because the buyer didn’t pay.
Buyers may have many reasons for the above actions, but doing so often means they found the deals unsatisfactory.
Reviews from other users
User feedback is an essential tool for gauging reliability. Here, you’ll find reviews from users who’ve completed orders with different vendors. A user can leave a positive or negative review only after their order has been completed. You can read more about the feature here.
You should always keep in mind, however, that reviews can be subjective. Not every review is truthful, so do ensure you read multiple reviews before deciding whether to choose a particular vendor or move on.
User status
Binance P2P has a number of different user types, which will tell you more about potential counterparties. This can help you make better decisions on whom to trade with. The user types include:
Verified User: A user who has completed the verification (KYC) process on Binance.
Verified Merchant: A trader who has passed the P2P team’s additional verification process. This includes providing the required documents and having a proven, impressive track record on both Binance P2P and other platforms.
Block Merchant: A merchant who offers a large volume of assets to trade and who has experience conducting large transactions in the new Block Zone. A large merchants also has a distinctive diamond icon.
Cash Merchant: A user who can post cash trading advertisements on Binance P2P. This enables merchants and users to meet face-to-face to trade crypto with cash.
P2Pro Merchant: A P2P merchant awarded P2Pro status. The Binance P2P team approves P2Pro merchants who meet their strict requirements, which include advanced qualifications.
The details of each user type informs you of their depth of experience and qualification level on Binance. This information is also essential when choosing any counterparty and making responsible trading decisions. You can also take note of an account’s registration date and first transaction date to determine how long the user has been trading and hence, their possible experience level.
How Binance Enhances Reliability in P2P Trading
Our rating system serves two purposes. First, it gives Binance P2P users a tool to assess the reputation and reliability of potential counterparties. Second, it encourages responsible and professional behavior from vendors. This two-pronged approach should make navigating the platform and choosing a suitable counterparty simpler.
Regardless of your user type, Binance P2P aims to offer a convenient, secure, and affordable way of buying crypto directly from others.
Further Reading
(Blog) Binance P2Pro: Connecting Professional Exchanges With P2P Traders
(Blog) 5 Tips on How to Pick the Best Offer When You Buy Bitcoin on Binance P2P
(Support) Binance Merchants P2Pro
Disclaimer: Your use of the Binance P2P services and all information and other content (including that of third parties) included in or accessible from the Binance P2P services is at your sole risk. Our only responsibility is to handle crypto transactions. All payments are final upon completion unless otherwise required by law. Binance P2P platform has neither the rights nor the obligations to resolve any disputes arising from a completed payment. Neither Binance P2P platform nor merchants shall be responsible for your loss in a completed payment.