In this post I’m going to show you how to buy Bitcoins without a middleman holding your Bitcoins and below the price market . You will always keep your private keys with you and you won’t have to share them with others.
First of all, let me introduce an application: Bisq.
Bisq is an open-source desktop application that allows you to buy and sell bitcoins in exchange for national currencies, or alternative crypto currencies.
Once you create and setup an account in Bisq, you will be able to contact to other persons to buy Bitcoins (or sell).
Installing and setting up Bisq
Download Bisq for your operating system: https://bisq.network/downloads/.
You will see the below windows (or similar if your version is different) when you launch Bisq:
Next, let’s configure an account:
Despite we have chosen SEPA, you can select a different payment method. My suggestion is to choose a payment method broadly accepted in Bisq because it will be more liquid
After you have configured your account, setup a wallet seed and a wallet password by clicking the corresponding tabs as shown in the above image. Store both things in a secure way. After that, perform a backup (Certainly, I perform a backup every time I transact on Bisq).
Open a trade to buy Bitcoins
Finally, we can create an offer to buy Bitcoins:
Notice how I have set a dynamic price of 1% below the price market. The price market is shown in red on the image. I have bought always, at least, at 1% below the price market (for those who think nobody will accept it). Also, look at the trade fee! Only 0.20%. You will have to hold some Bitcoins to pay in advance in escrow.
The not so good part
In contrast to the previous obvious benefits, the trade can take days to complete. The steps in a SEPA trade are:
- Create an offer
- Someone accepts your offer
- Send the SEPA transfer
- Wait for the counterpart to receive your payment
- When received, the funds will be send to you
While performing the above steps, the funds are locked and secured in a bitcoin smart contract. You can close the application and reopen it later without problem despite you have opened trades. However, if you have opened trades, you will have to open the application to check if someone has accept or modify your trade state. Otherwise your trade could be arbitrated and you may loose your Bitcoins stored as collateral in the smart contract.
If one of the parts behalf incorrectly, you can ask for two random arbitrators to review all the process. I have to admit I never asked for arbitrage.
Enjoy and hodl!!