Unlike other exchanges where the third party is in charge of transactions, P2P exchanges are independent of any central body. The exchange only acts as an online platform to bring traders together, so this makes them prone to scams as transactions are done directly between the traders. You are fully in charge of the transaction and you have the choice to select who you want to trade with and what payment means. P2P exchanges like Remitano allow you to buy Bitcoin with your local currency with no charges.
Due to the method of transaction in peer-to-peer exchange, it is very prone to scams, so before using a P2P platform, it is important to understand ways you can be scammed and how to avoid them.
Some pitfalls you should watch out for when trying to buy bitcoin using P2P
This is a scam where the seller uses a different account to receive funds. The seller sends you different account details through another medium to receive payment. After you make payment to this account, they will claim that they didn’t receive the funds and refuse to complete the transaction.
To avoid this, you must be sure that the account you are paying to is the same as the one the seller has provided on the platform. Also, confirm that the account name corresponds with the sellers’ identity. Do not make payments to an account different from the sellers’.
Fake or Reversible transfers
This is a very common scam in the P2P community. In this case, the buyer follows the necessary step by paying the seller, which makes the seller finalize and complete the transaction. However, after several hours, the buyer will make a false complaint to the bank that he didn’t make any transaction. The bank then refunds the buyer. This makes the seller lose both the crypto and the money.
The popular situation is when the buyer sends a kind of fake credit alert to the seller that makes them finalize the deal, however, in an actual sense, no money was sent to the account.
To prevent this kind of scam, always ask for proof of payment from the buyer, probably a screenshot of the payment. This confirms that payment was made by the buyer. Also, before completing the trade, confirm that the money is already in your account.
These are the common ways scammers look to exploit careless or new users. Now let’s look at the general ways to protect ourselves from being scammed when trading with P2P.
Do not pay the seller until the crypto is in the escrow
When you want to buy BTC using a P2P, the seller may ask you to send the money without sending the coin to escrow. Once you do this, the probability of getting your coin is very low if not zero. Once the seller transfers the crypto to the escrow, it will show on the trade page.
Do not authorize transaction until you confirm payment
If you are a seller using a P2P platform, it is very important to confirm the payment before releasing the crypto in escrow. Always be sure that the money has already been paid. Do not depend on evidence provided by the buyer. This is because scammers could provide fake evidence of payment. Although it is important to ask for evidence of payment, you shouldn’t rely on it as a form of confirmation.
Always Maintain In-Trade conversations
Conversations should be limited to the platform. do not make payment to details provided outside the platform. If the buyer sends money to an account different from the one provided on the platform, it is easy for the seller to deny the transaction and raise a false dispute that the buyer didn’t pay. Always confirm that the account name corresponds with the sellers’ identity.
Understand your payment method choice
There are different payment methods, so it is important to know the risk associated with the one you use, as some of these methods put the seller at risk. This is because some payment methods have the possibility of a chargeback, this implies that the payment can be reversed in some situations. So if a buyer charges back the payment, the seller loses both the crypto and the funds.
Always check seller/buyer reputation
Before choosing a seller or buyer you want to deal with, always check their reputation and feedback scores. P2P exchanges like Remitano welcome new users every day so there are plenty of new traders with good feedback scores, however, it is safer to deal with a trader with a solid trade history.
How do P2P platforms like Remitano protect you from scams?
To sell or buy bitcoin using Remitano, you must create an account and verify it. You have to complete the KYC verification. This feature ensures that every user that wants to trade on the exchange must use their original identities.
In every transaction, Remitano has an escrow feature to hold and secure the crypto temporarily. When you open a trade to buy bitcoin or any other coin, the amount of crypto you want to buy is transferred from the seller’s wallet and held locked on Remitano’s escrow service. With this feature, you can pay the seller without the fear of being scammed. Your coins will be released from escrow when the seller confirms the payment.
Remitano has friendly and quick responding customer support that attends to disputes with immediate effect. If you have an issue completing a trade with the other party, you can contact the customer support team to help resolve the issue.
In conclusion, buying bitcoin on P2P platforms like Remitano is a straightforward process. However, the trader you are dealing with determines how smooth the trade will go.