Peer -To -PEER trade includes a direct, decentralized interaction between the two parties, without the need for downtown or replacement. Here is the breakdown of the funds:
The key players
- Buyer : A party that buys securities (eg warehouses, bonds) from the other party.
- Seller : Party sells to buyer.
- Market Manufacturers
: Individuals or companies that offer liquidity and do business on behalf of other market participants.
Distributed commercial platforms
The trade of companions can be facilitated through a variety of decentralized platforms, for example:
- Cryptocurrency replacements : Online platforms where customers and sellers change cryptocurrencies such as bitcoin, Ethereum or others.
- Capital market : Online platforms that bind buyers and sellers to securities stores.
- Markets
: Physical locations or online spaces where market parties can interact directly.
Main concepts
- Order types : different types of orders such as market order (purchase/sale), border order (set price), stop loss (set price), etc.
- Liquidity Service Providers : Individuals or companies that provide liquidity on the commercial platform allows you to enforce your trade faster.
- Market Depth : In a certain security, the level of trading activities reflects the number of purchasing and sales orders.
Benefits
- Increased efficiency : Distributed commercial platforms can perform stores faster than traditional stock exchanges.
- Lower salaries : Some decentralized platform charge lower payments than the traditional stock exchange.
- Improved Accessibility : Online platforms can combine customers and sellers with wider participants.
Risks and challenges
- Liquidity Risk : Market manufacturers or liquidity service providers are not always available, leading to potential price diseases.
- Disad Risk : Customers and sellers may have difficulty in closing due to differences in market conditions.
- Regulatory Challenges : Distributed commercial platforms often work beyond traditional regulatory frameworks.
The best exercises
- Do a thorough study on the platform, its user and market conditions before peer -peer trade.
- Set clear goals , to stop risk management strategies and stop levels to avoid significant losses.
- Stay up -to -date from market development and modify commercial strategies accordingly.
In summary, the Peer -To -Peer online store offers different benefits, including increased efficiency, lower rewards and better accessibility. However, there are also risks and challenges that require careful consideration and caution. By understanding the basics of contemporary trade, customers and sellers can make conscious decisions to alleviate potential pitfalls.
