There are many ways to convert cryptocurrency into fiat currency. But sometimes, users do not want to completely withdraw and switch from one cryptocurrency to another.
Going to fiat and then buying back doesn’t always seem the way to go for many reasons, including having to pay conversion fees more than once.
This is where cryptocurrency swaps prove to be particularly effective and convenient, and this is where Bitpapa comes into play as well.
Understanding Cryptocurrency Swaps
Services offering cryptocurrency swaps work in the same way as book-based exchanges and peer-to-peer markets. It allows all users to do basically the same thing (transfer cryptocurrency) but using different tools. Above all, the user experience varies.
Order book-based exchanges allow users to adjust their trades. They can set orders with specific price points that they want to execute and fill, and also pre-set the order amount. Of course, they also have their drawbacks, especially for people who do not want to trade professionally. They also require users to deposit fiat currencies into their accounts from which they can purchase cryptocurrencies. This is in stark contrast to peer-to-peer (P2P) markets, where users must trade with each other, and the market stores only cryptocurrency, which is then used to secure trades.
However, these types of platforms are not very flexible when it comes to supported trading pairs. It is well suited for switching in and out of some of the most popular cryptocurrencies, such as BTC and ETH, but if users want to convert to any other digital currencies, their options may run out.
Cryptocurrency swap services combine the simplicity of a P2P marketplace with a wide range of pairs supported by advanced order-based exchanges.
Cryptocurrency swaps work best when an immediate solution is needed to exchange one cryptocurrency for another with minimal effort. This is one of the reasons why many exchanges and marketplaces have made this option available to their users – as a useful addition to the list of features that these platforms already support.
This is also exactly what Bitpapa Swaps brings to the table.
Simplify the user experience
Bitpapa Swaps builds on and extends the functionality of the Bitpapa platform – a global marketplace for secure P2P transactions. In essence, the platform provides users with a safe and secure trading environment by facilitating accurate and fast execution of the deals made by Bitpapa users among themselves.
The platform currently supports storing, sending, receiving and trading such cryptocurrencies as Bitcoin, Ethereum, TON, Monero and stablecoin USDT. Users can buy these with fiat money and sell them for fiat, but they can’t transfer them directly to each other.
Bitpapa Swaps are designed to tackle this severe annoyance.
There are at least two use cases where cryptocurrency swaps can be beneficial. In the first case, users may want to book their earnings now and possibly reinvest the earnings later. Without swaps, they would first have to sell their coins for fiats and then buy them back via some fiat payment system (such as bank transfer), fees included.
With cryptocurrency swaps, it is possible to use USDT as an alternative to fiat without actually having to use fiat, thus completely avoiding payment system fees (not to mention saving time and effort).
In the second case, users may want to sell one cryptocurrency for another, for example, Bitcoin for Ethereum, anticipating or discovering the rise of the latter against the former. As in the previous case (without swaps), they will first have to move from Bitcoin to fiat and then back to Ethereum – the same fees are generously applied (twice).
Cryptocurrency swaps now allow jumping from one cryptocurrency to another without having to use fiat currency as an intermediary. To do this, the user just needs to go to the Bitpapa swaps page, select a pair of cryptocurrencies, enter the amount of cryptocurrency to convert and start the conversion.
The cross price at which the exchange occurs is determined using the same technique as the price for P2P transactions (as an average of prices obtained from more than 7 major exchanges). The user can either choose a floating exchange rate or a fixed exchange rate. In the latter case, he will have a 10-minute exchange rate lock, during which he needs to complete the exchange process.
The main idea behind Bitpapa Swaps is to offer a simple tool that helps Bitpapa users to exchange one cryptocurrency for another quickly, without the need for trading skills.
The Bitpapa Enters Cryptocurrency Swaps post first appeared on CryptoPotato.