Bisq is a cryptocurrency exchange that got its start in 2014 under the name Bitsquare. It is one of a handful of fully decentralized exchanges for both crypto and fiat currencies. It truly has come a long way since its early days, and has made itself into an established and useful alternative to the traditional centralized exchanges, while also creating new trading concepts along the way.
It’s true that some features of the Bisq platform appear to be reserved for die-hard cryptocurrency enthusiasts with deep knowledge of technology and computing, but the trading principles and use of the exchange are actually easier to learn than you might think. Even better, the design of the Bisq architecture makes it less prone to hacking attacks, security breaches and regulation.
The remainder of this review will go further in-depth to discuss various aspects of Bisq, including basic functionality, requirements for trading user data protection, payment methods, the Bisq coin, and so much more.
Bisq Review: Organization Overview
The first important thing to understand about the Bisq organization is that it isn’t a company or a non-profit. It’s a new type of structure known as a decentralized autonomous organization, or more simply put a DAO. This type of organization is created by small snippets of code in the underlying blockchain which act to create a distributed consensus in the organization. One of the key features of any DAO is that there is no central point of failure.
The fact that Bisq is a DAO is what gives it some of its key features, namely security, instant access, and privacy. And because it is community developed it has a completely open-source code base, making it totally transparent. Anyone with coding skills can review the application code and determine if the exchange is trustworthy, and judging by the reviews of those who’ve delved into the code, Bisq is worthy of trust.
Bisq doesn’t come without its downsides though. If you see low adoption so far, realize that the DAO concept is a bit strange for many users who are used to the traditional centralized banking structure. And because of its low adoption so far volumes and liquidity on the exchange remain low. Furthermore, the code is still in beta development, so processing times can be slow. That said, the attention to detail has been obvious thus far, and the finished product is almost certain to be of a very high quality.
Bisq is an excellent idea that is backed by a group of talented and dedicated individuals who are working on some unique exchange features. You’ll find everything explained in detail in the Bisq whitepaper, but if you don’t want to wade through all the technical language you can read on and this review will give you the information you need to understand Bisq and its trading interface.
Bisq Review: Trading Conditions
In comparison with other exchanges, Bisq has fairly low requirements when it comes to trading conditions. The trade limits vary based on the method used for depositing. If you deposit via bank transfer the trading limit is 0.25 BTC, while cryptocurrency deposits have a 1 BTC trading limit. The deposit method will also determine how long it takes to process your deposits and withdrawals. In some cases, such as cryptocurrency transfer, the processing is nearly instant, but with bank transfers you can expect to have a delay of several business days.
When it comes to fees the Bisq fees are pretty standard for cryptocurrency exchanges, averaging 0.2% of the trade for both buyers and sellers. These fees are used to cover the transaction and mining fees as well, but there are no discounts for larger trade volumes such as you would find at most centralized exchanges.
Another difference with the Bisq app is the requirement to keep the platform open to keep an offer visible to other users. So, if you create an order to sell some Bitcoin you need to keep your computer on and connected to the internet to keep the order visible to buyers on the platform. If your computer does go offline the order is removed from the order book, and is then re-added once the computer connects to the internet again.
Some users might find this inconvenient, or even impossible, but the design of the Bisq platform requires sellers to be connected to the Bisq platform to have their orders filled. Once the order is filled you’re able to disconnect from the internet.
One other difference with Bisq is that you can place percentage-based orders on selected assets on the exchange, with prices changing as the average market price changes on Coinmarketcap.com. This ensures you can always get the best price at any given time, and will also help you sell your cryptocurrency faster. If you’re a buyer you’re free to move your assets to the wallet of your choice as soon as the purchase is complete.
Bisq Review: How to use the Bisq Platform
Because Bisq is a peer-to-peer environment it is quite simple to access the marketplace once you download and install the Bisq app. The app itself has been developed by a handful of coders who are enthusiastic over the prospect of a completely decentralized cryptocurrency exchange and the code base is open-source, just like everything about Bisq.
Once you install the Bisq app it allows you to connect to the marketplace as a network client. And thanks to the efforts of the developers you can find an app for Windows, Mac and Linux. The open-source nature of the code let’s you look under the hood, and digital signatures verify that the download is authentic.
When it comes to trading, let’s look at an example where you’re using U.S. Dollars to purchase Bitcoin in the Bisq marketplace. Once the app is installed and configured you simply browse the market looking for someone who is interested in selling Bitcoin for USD. Once you find and select the offer you like you can send your USD payment via the preferred method to the seller’s account. Once that transfer is marked as complete your Bitcoin is transferred to your account. Selling works in a similar fashion, although you do have to deposit your cryptocurrency for sale in an escrow account.
Bisq Cryptocurrencies
Let’s have a look at what cryptocurrencies you can buy and sell on the Bisq platform. As you might have guessed, the largest volume on the platform is in buying and selling Bitcoin. But aside from that there are over 50 other altcoins available on the Bisq platform. This includes some of the most popular cryptocurrencies such as Ethereum, Litecoin, Monero, Dash and many others. And if the crypto you’re interested in isn’t supported yet, you can suggest that the developers add it to the platform. Pricing keeps pace with average market pricing, and is updated in real-time. With the decentralized nature of the exchange and the broad offerings, it is something special within the cryptocurrency industry.
The Bisq Application
The Bisq application was developed to work with any of the top three operating ssytems – Windows, iOS and Linux. The appplication interface itself is fairly simple, as you’ll see below in my explanation of functionality.
Once you’ve installed the app and have an account created you’re ready to start trading the supported cryptocurrencies. One of the key features is adetailedook, updated in real-time, including a graph which shows the ratio of buy vs sell orders. You can also set prices from different price feeds, as well as placing buy and sell orders here.
If you go to the Account tab it will allow you to link both bank accounts and existing cryptocurrency wallets to your trading account, making transfers both in and out much easier. The Accounts tab is also where you set an arbitrator (which I’ll talk more about later), get a wallet password or backup seed, and create a full backup of your Bisq trading wallet.
The Funds tab is where you track all your transactions. Every buy and sell transaction is here, as are deposit and withdrawal transactions. You can also generate an unlimited number of wallet addresses here, which is great for maintaining privacy if you’ll be making multiple deposits into your wallet. To make mobile transactions easier there is also a QR code generated for each address. Finally, you are able to modify application settings, manage your account details, and contact support, all from within the app.
Anyone with previous cryptocurrency exchange experience will intuitively figure things out in no time, and even new cryptocurrency traders should be able to figure out most features easily and quickly. If more explanations are required, there are educational materials available on the Bisq website. These can be helpful for the more advanced features like technical analysis and trading signals.
Bisq Deposit and Withdrawal Methods
Bisq has not left you spoiled for choices when it comes to deposits and withdrawals. In fact, it has outstripped most other exchanges as it offers no less than 15 different methods. Of course bank transfers are available, as are the more advanced Zelle, SEPA and Faster Payments. Major credit cards are accepted, and you can link directly to a cryptocurrency wallet. Unlike other cryptocurrency exchanges, Bisq also supports Swish, Perfect Money, AliPay, OKPay and many other online payment options. Your fees will be determined by the deposit or withdrawal method, but you’ll find that the fees are competitive with other exchanges.
Bisq Review: Security
Security is probably the most important feature of any cryptocurrency exchange, and part of the reason for Bisq being decentralized is to support better security and privacy of personal data. Since the start Bisq was developed and architected with security in mind to keep both your funds and your data safe and intact.
Users of Bisq always remain in control of their assets (fiat and cryptocurrencies), because Bisq is no more than a mediator between the buyers and sellers. The trading application doesn’t store any information about your account or about any transactions. The only place information is stored is on the blockchain itself, and there’s no personally identifying information stored.
To trade on Bisq requires a security deposit from both parties, this is in case of any disputes, and it makes fraud on the platform too expensive and time consuming to be profitable. Additionally, all assets included in trades are subject to multisig escrow that requires miimum verification of two network nodes. All of this is accompanied by a decentralized, human arbitrary dispute handling system to ensure security when trading on Bisq.
In addition to the security features, there are also privacy features, the chief of which is a lack of identity verification requirements. So, unlike the centralized cryptocurrency exchanges, Bisq will not ask you for your address, or to provide copies of drivers license or other government issued ID. And even though there isn’t much information stored in the first place, the decentralized nature of the network makes it nearly impossible to steal even the small amount of data that is saved. It’s also equally impossible to inject false information into the system.
The requirement for all network changes to be verified by all participating nodes makes spoofing the network impossible, and imposters or bad actors are quickly identified and exiled from the network, keeping Bisq safe from attacks and fraud. And Bisq has been built on top of the Tor network to keep everything anonymous and invisible to outsiders, no matter what you’re trading. And as a final security measure all transactions are encrypted to avoid hacking and keep everything completely safe and secure.
The Bisq Coin and Arbitrators
The Bisq exchange also has a Bisq coin, but it is only for internal use and can’t be traded on any cryptocurrency exchange. You can think of it as the fuel or gas for the Bisq network. The initial distribution occurred when the Bisq network raised donations for a BSQ coin, and then created 25 tokens and split them between 144 core project contributors. This was basically a reward for all the work they had done to make the Bisq project a reality. The Bisq coin supply is increased as rewards are created for contributors, while the coin supply decreases as mandatory network fees are paid.
The Bisq coin is how the project provides an incentive for developers to contribute and improve the network, and it also provides the gas for traders to pay the required trading and network fees. The BSQ coin currently has five uses within the network: earning, spending, trading, voting, and bonding. These five use cases create a functioning economy.
The arbitrators are the actual humans who look at disputes in the network. New arbitrators must be recognized by the existing arbitrators and by the traders, and this means they must hold a large number of BSQ coins to submit as a bond that guarantees their fair and impartial role as an arbitrator. There are currently only a handful of arbitrators due to the large number of BSQ required, but the next version of the application is supposed to open applications for the arbitrator function to anyone.
Bisq Review: Customer Support
The Bisq exchange is unique in that support can be reached from right within the trading application. And by all online accounts, they are responsive, fast and professional. Any questions are quickly answered, from trading or deposit/withdrawal questions to safety issues and even information about pricing and fees. Those who are happy to find their own answers can often do so in the detailed FAQ document on the Bisq project website.
Those who are deeply interested in the project can also head over to the Bisq Github and go through the code base to find any bugs, or to suggest improvements. The ultimate goal of Bisq is a completely dcentralized P2P platform that involves its users to change the way cryptocurrencies are traded. There are also a number of other ways to contact those already involved with the Bisq project, including a forum on the website, Twitter, Slack, Reddit, Keyspace and a mailing list dedicated to developers. They also have a YouTube channel for releasing guides and information. All of these channels together have helped to create a vibrant and dedicated community of supporters.
In Conclusion
When it began as Bitsquared it was the first of a growing trend towards decentralized exchanges. Being first certainly didn’t make it easier, but the determined and passionate group behind the project kept it moving and growing into what it is today. This type of decentralized exchange could disrupt not only cryptocurrency trading, but eventually trading in all types of assets, from stocks to commodities.
The benefit of anonymity, safety, fair trading conditions and a broad list of assets makes Bisq attractive to many traders. There are no reasons not to trade here, although liquidity remains low on the exchange. It really needs an influx of users, which may not come until the project finally launches out of beta.
The best way to test it yourself is to open an account and make a trade.