How to invest in crypto without UPI

As Indian crypto exchanges shut down Unified Payments Interface (UPI) services and restrict access to online banking services, crypto users are stuck with their digital assets looking for workarounds and new options to start trading.

This comes after a circular from the National Payments Corporation of India (NPCI) said it was not aware of crypto payments through UPI. This has led to crypto exchanges such as: Coinbase withdraws its UPI installation, the addition of a roadblock that allows users to initiate trades on the exchanges.

In this week’s column, we discuss how users can trade on crypto platforms in the absence of UPI and banking services.

Peer-to-peer (P2P) trading

Peer-to-peer (P2P) trading makes it possible to buy and sell cryptocurrencies without the involvement of a third party or intermediary. While you technically need a platform where buyers and sellers can connect, you don’t necessarily have to transact with the platform, all transactions take place between the two parties – the seller and the buyer.

Unlike crypto exchanges, P2P trading gives you more control over who buys your crypto assets. For example, if you want to sell a crypto asset that you hold on a crypto exchange, use charts to determine the optimal time to buy, sell, or hold cryptocurrencies. But when you decide to sell, the final price of the asset depends on the market price of the exchange.

On the other hand, P2P trading gives users complete control over the process. You decide who to sell your assets to and at what price, but there can be some risk involved if there is no ‘middleman’ controlling the transaction. This is where platforms like Binance and Paxful become essential.

“By allowing people to trade freely around the world, peer-to-peer platforms provide access to the global financial system. Everyone has the freedom to choose the offers, trading partners and margins they want,” Ray Youssef, co-founder and CEO of Paxful, told indianexpress.com.

Step by step instructions

There are many things you can do on P2P platforms, including buying, selling and trading cryptocurrencies such as Bitcoin, Ethereum, Litecoin and more. Here is a step by step tutorial on how to buy Bitcoins on the P2P trading platform. (For demonstration purposes, we used Paxful P2P trading platform)

#You must first open an account by registering on the platform.

#The platform does not charge the buyer. The amount of Bitcoin in trading is exactly what you get in your Bitcoin wallet.

#When deciding to buy, the three most important things to consider are the payment method, amount and currency. You can buy Bitcoin by making a purchase offer or by offering to buy Bitcoin from a seller on your terms. Read the seller’s instructions and make an offer with a reasonable chance of conversion.

#When you’re ready to buy, you can select your preferred payment method. When using a payment method, make sure it has the same identification as the account you are transferring money from.

#The seller confirms your payment and your Bitcoin is released.

It is important to understand that traditional providers can charge high fees or offer unfavorable exchange rates when completing a transaction. Compared to peer-to-peer platforms, these costs are expensive and inefficient.

Ensuring the security and anonymity of transactions

To ensure transaction security, P2P trading platforms often use security features such as encryption and two-factor authentication. This gives users the confidence to transact on these networks.

P2P makes it easier to trade globally and opens up a world of possibilities as you can trade any currency or asset you want. Once a trade has started and your crypto is held in escrow, the seller cannot undo the trade; it can only be canceled by the buyer or automatically canceled by the system if the payment is not made by the buyer within the payment window.

In terms of anonymity, crypto is pseudonymous in the sense that your name is not directly related to the transactions you make. It should be noted that most P2P platforms implement standard know-your-customer (KYC) and anti-money laundering (AML) processes before trading. All users go through KYC processes; however, these security procedures may differ on other financial platforms.

Last word

P2P platforms make it easier to find buyers and sellers for the desired crypto at any time, meaning it is easier to find buyers or sellers for the desired currency at any time. However, scammers are also increasingly taking advantage of P2P trading with new platforms promising zero trading fees. It is important to do your research before choosing a platform and always exercise caution when transacting online.

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