P2P Trading Glossary
Plain-language definitions for every term you'll encounter in P2P crypto trading. 30 terms, constantly updated.
P2P Trading (Peer-to-Peer Trading)
Direct trading between two individuals without a centralized intermediary. In crypto, a P2P platform provides escrow, messaging, and dispute resolution — but the counterparty is a real person, not the exchange. P2P trading offers more flexible payment methods, negotiated prices, and no exchange custody of funds. It is particularly dominant in markets where centralized exchanges have limited fiat on-ramps or where users prefer to trade without routing funds through a third party.
Escrow
A neutral holding mechanism where funds are locked by a third party until both sides of a transaction fulfill their obligations. In P2P crypto trading, smart contract escrow locks USDT when a trade opens and releases it only when payment is confirmed by both parties. Escrow eliminates the core risk of P2P trading: neither the buyer nor the seller has to trust the other person — they only need to trust the contract.
USDT (Tether)
The world's largest stablecoin by trading volume, pegged 1:1 to the US dollar. One USDT is always worth approximately one dollar, making it the standard currency for P2P trading globally. USDT is available on multiple blockchains including TRC-20 (Tron) and ERC-20 (Ethereum). Its combination of price stability, deep liquidity, and multi-chain availability makes it the dominant P2P trading asset in emerging markets across Africa, Southeast Asia, and Latin America.
Stablecoin
A cryptocurrency designed to maintain a stable value relative to a reference asset, typically the US dollar. Stablecoins like USDT, USDC, and DAI allow traders to hold and transfer dollar-equivalent value on a blockchain without exposure to Bitcoin's price volatility. In P2P trading, stablecoins are preferred because both parties can agree on a price denominated in a stable unit — there is no exchange rate risk during the minutes a trade is open.
KYC (Know Your Customer)
The identity verification process financial platforms use to confirm a user's real identity before they can transact. Typically involves submitting a government-issued photo ID and a selfie or liveness check. KYC prevents fraud, money laundering, fake account creation, and chargeback fraud. On P2P platforms, mandatory KYC means every counterparty you trade with is a verified real person — not an anonymous scam account.
AML (Anti-Money Laundering)
A set of regulations and platform controls designed to detect and prevent the use of financial systems for laundering illegally obtained funds. P2P platforms apply transaction monitoring, suspicious activity reporting, and user profiling as part of AML compliance. AML procedures are distinct from KYC — KYC verifies who someone is, while AML monitors what they do with the platform over time.
TRC-20
The USDT token standard on the Tron blockchain. TRC-20 USDT transfers cost less than $0.01 per transaction, making it the preferred network for P2P trading in emerging markets where transaction cost matters at small trade sizes ($10–$500). TRC-20 is the default USDT network on P2PLY for this reason. Compare to ERC-20, which uses the Ethereum network and has significantly higher gas fees.
ERC-20
The USDT token standard on the Ethereum blockchain. ERC-20 USDT is more widely used in Western DeFi protocols and institutional markets. Transaction fees (gas) are significantly higher than TRC-20, making it less practical for small P2P trades. ERC-20 USDT has the deepest liquidity of any stablecoin token standard globally and is accepted on all major exchanges.
Fiat Currency
Government-issued currency not backed by a commodity (e.g., USD, EUR, NGN, PHP, PKR). In P2P trading, one side of every trade is always fiat — the buyer sends fiat payment while the seller releases crypto from escrow. The payment methods used (bank transfer, mobile money, cash deposit) determine how the fiat moves. P2PLY supports fiat payment in local currencies across 120+ countries.
Smart Contract
Self-executing code deployed on a blockchain that automatically enforces the terms of an agreement without requiring a trusted intermediary. Some P2P escrow systems use smart contracts; P2PLY v1 uses controlled custody, internal balance locks, audit trails, and signer controls instead of user-held keys.
CEX (Centralized Exchange)
A crypto exchange that holds user funds, manages order books, and acts as the counterparty in trades. Examples: Binance, Coinbase, Kraken, Bybit. Contrasted with P2P platforms, where trades happen directly between users and the exchange does not hold funds. CEX P2P features (like Binance P2P) combine centralized exchange infrastructure with P2P mechanics — meaning exchange-level account freezes can affect P2P trading access.
Dispute Resolution
The process a P2P platform uses to adjudicate conflicts between traders when a trade cannot be completed normally. Typically involves a compliance team reviewing evidence (chat logs, payment proofs, bank records) while the disputed funds remain frozen in escrow. On P2PLY, standard disputes are resolved within 24–48 hours and high-value disputes (above $5,000) receive priority review within 4 hours.
Liveness Detection
A biometric verification technique that confirms a submitted video is of a live person — not a static photo, a printed image, or a pre-recorded video. Used in KYC to prevent identity fraud. P2PLY's liveness detection requires users to blink and make specific head movements during verification, confirming the person in front of the camera is physically present and not using a spoofed image.
Payment Method
The fiat transfer mechanism a P2P buyer uses to pay the seller. Common methods include: bank transfer, mobile money (GCash, M-Pesa, Easypaisa, OPay), cash deposit, and digital wallets. The payment method determines trade speed and geographic availability. A Nigerian seller accepting OPay can only be paid by buyers with OPay access — payment method matching is how P2P platforms connect local trading pairs globally.
Chargeback
A payment reversal initiated by a buyer through their bank or payment provider after a transaction is complete. In P2P crypto, chargeback scams involve a buyer paying with a reversible method, receiving USDT, then filing a chargeback to claw back the fiat. Sellers should only accept irreversible payment methods: most bank wire transfers, mobile money (Easypaisa, GCash, M-Pesa), and cash deposits. Avoid PayPal and credit card payments for crypto trades.
Volume Tier
A fee structure some exchanges use where higher trading volumes over a rolling period qualify for lower fees. P2PLY doesn't use volume tiers — buying and selling is free for everyone, with a small 0.2% maker fee only for users who post their own ads. This keeps costs simple and predictable regardless of how much you trade.
Trade Completion Rate
A metric showing the percentage of initiated trades a user successfully completes. A high completion rate (above 95%) indicates a reliable counterparty — someone who follows through consistently. A low rate suggests the user frequently cancels trades or fails to complete payment, which is a scam risk signal. P2PLY displays completion rates on user profiles to help traders make informed counterparty decisions before accepting a trade.
Triangular Fraud
A sophisticated P2P scam where a fraudster uses three parties — an innocent buyer A, an innocent seller B, and a victim C — to execute circular payment confirmations that appear legitimate while no real fiat changes hands. P2PLY's AI detection system specifically models multi-party transaction graphs to identify triangular fraud signatures, flagging suspicious patterns before victims confirm trades.
Device Fingerprinting
A security technique that creates a unique identifier for a user's device based on hardware and software characteristics (screen resolution, browser configuration, installed fonts, GPU, etc.). Combined with IP monitoring, device fingerprinting detects when the same physical device is used to operate multiple accounts. This makes account farming — creating many verified accounts to abuse reputation scores or volume limits — detectable and blockable.
Maker / Taker Fee
A fee model used by exchanges where makers (who post offers and add liquidity to the order book) pay lower fees than takers (who accept existing offers and remove liquidity). Some P2P platforms embed their revenue in the spread between buy and sell prices rather than charging explicit maker/taker fees. On P2PLY, buying and selling is free (0% taker) — only advertisers who post ads pay a small 0.2% maker fee, and never a hidden spread that disguises the true cost of a trade.
UPI (Unified Payments Interface)
India's real-time instant payment system, built by NPCI, that links bank accounts to apps like PhonePe, Google Pay, Paytm, and BHIM. UPI settles rupee transfers in seconds, 24/7, and is the most widely used payment method for P2P USDT trading in India — a buyer sends INR to the seller's UPI ID and marks the trade paid. Because UPI is instant and hard to reverse, it is one of the safest rails for peer-to-peer trades.
IMPS (Immediate Payment Service)
An instant, 24/7 interbank money transfer service in India, often supporting higher per-transaction limits than UPI (up to ₹5 lakh at many banks). IMPS is a common alternative to UPI for larger P2P USDT trades, keeping instant settlement while allowing bigger amounts. Like UPI, IMPS transfers are hard to reverse, reducing chargeback risk.
1% TDS (Section 194S)
A 1% Tax Deducted at Source on transfers of Virtual Digital Assets in India, applied when transactions exceed ₹10,000 in a financial year (₹50,000 for specified persons). TDS is not an extra tax — it is an advance credited against your final tax liability when you file. On compliant platforms it is handled automatically and a certificate is issued.
VDA (Virtual Digital Asset)
The legal term used in Indian law for cryptocurrencies, NFTs, and similar tokens. India taxes VDA gains at a flat 30% (Section 115BBH) plus cess, applies a 1% TDS on VDA transfers (Section 194S), and requires VDA service providers to register with FIU-IND. USDT is a VDA under this framework.
Section 115BBH (30% Crypto Tax)
The section of India's Income Tax Act that taxes gains from transferring Virtual Digital Assets at a flat 30%, plus applicable surcharge and 4% cess. No deductions are allowed except cost of acquisition, and crypto losses cannot be set off against other income or carried forward — making it one of the strictest crypto tax regimes globally.
FIU-IND (Financial Intelligence Unit-India)
The Indian government agency, under the Ministry of Finance, that requires all Virtual Digital Asset service providers operating in India to register as reporting entities under the PMLA. Since March 2023, FIU-IND registration means mandatory KYC, transaction monitoring, and suspicious-transaction reporting — the reason every compliant Indian crypto platform verifies identity.
Schedule VDA
The dedicated section of the Indian income tax return (ITR) where taxpayers report gains and holdings from Virtual Digital Assets. Introduced alongside the 30% tax framework, Schedule VDA formalises crypto reporting — keeping clean records of every trade (date, value, counterparty, TDS certificate) makes filing straightforward.
BEP-20
The USDT token standard on the BNB Smart Chain. BEP-20 USDT transfers are low-cost and widely supported across wallets and platforms, though fees can rise when the network is busy. It is one of three USDT networks P2PLY supports, alongside TRC-20 and Polygon.
Polygon (USDT)
USDT on the Polygon network — a low-cost, high-speed option for moving Tether. Fees are very low and confirmations are fast, making Polygon a popular cheap alternative to TRC-20 for Indian traders. Always match the network on both ends when sending USDT.
USDT Premium
The gap between the market price of USDT in a local currency and the official exchange rate of the dollar it is pegged to. In India, USDT often trades slightly above the official USD/INR rate on P2P markets when dollar demand is high — a live premium P2PLY tracks in its USDT/INR Rate Index.