The crypto ecosystem has proven to be resilient having bounced back from the March bloodbath which saw the market dip significantly. At some point, the price of Bitcoin fell below $4,000 although it did not hold for long before retracing to $7,000. Today, we are talking about the possibility of breaking a $12,000 resistance level given the current bull market that has since sparked more excitement about crypto. In fact, Corporate America might soon be joining the party following a move by Business Intelligence giant MicroStrategy to allocate $250 million into Bitcoin as a counter-inflation asset.
With Institutional funds now flowing into the crypto ecosystem, retail traders looking to purchase Bitcoin and other crypto assets also stand to benefit a great deal. P2P crypto trading platforms like Bitcoin Global are coming up with advanced pricing features from which stakeholders can leverage arbitrage given the young nature of digital currency markets. This global P2P Bitcoin trading platform basically allows users to trade directly with each other hence a big player in on-ramping newbies and liquidity creation. It accepts over 100 fiat currencies including USD, CAD, AUD and JPY amongst other prominent local denominations.
Pricing Equations in P2P Bitcoin Trading
Pricing equations are designed to determine the value of an underlying asset based on the integrated functions. The Bitcoin Global approach for instance, has been a default pricing equation supported by a special market data source dubbed ‘btc_in_usd’. This means that the BTC trading advertisements within its ecosystem are pegged to price information gathered from Bitcoin exchanges through the btc_in_usd market data source.
The equation returns median prices from various trusted crypto exchanges which ultimately reduces the variation should one source give a skewed median. However, for market makers to be profitable, they ought to at least place margins so as to hedge against exposure while taking the most gains possible. Bitcoin’s Global solution on this end is a simple multiplication operator which basically places the margin above the market data prices.
The Value Proposition of Customized BTC Pricing Equations
Other than the default pricing equation, Bitcoin Global users can now customize their own functions based on prices from five exchanges; Bitfinex, Coinbase, Kraken, Bitstamp and WhiteBIT. With this option in place, one is flexible to select their own market data sources as well as the preferred operators in profit estimation. The process is also quite simple given each equation uses one data source, averaging the 24-hour price of Bitcoin.
To leverage a particular market data source, users are only required to lift their preferred equation from the market column and include it in the price type. For example, a trader who wants their price advertisements to follow Bitfinex metrics would have to lift an equation dubbed ‘bitfinex_usd’, and integrate an average function so as to get 24-hour BTC pricing information. In addition to this, they can apply the operator of their choice based on market positions like the ability or willingness to accommodate risk.
The featured operators in Bitcoin Global can actually be nicknamed the ‘butter’ of its new BTC customizable pricing equation. Operators that traders can use to set margins include addition, subtraction, multiplication, division and min/max functions. The latter are particularly interesting as they can enable one to compare prices from two exchanges and automatically select the maximum or minimum BTC price, depending on the command function. However, multiplication will be the final operator in most cases, given users are looking to increase the gathered market data price by some factor to scale their profit range.
It is also quite noteworthy that one can use any of the Bitcoin Global price sources regardless of the base currency. This because its pricing equation further allows users to convert the fiat currency that was initially featured into their preferred legal tenders. With operations in over 100 countries and having added Chinese and French languages on their website, Bitcoin Global might be well on track to create an ecosystem that favors customizable BTC pricing with a reference to most of the world’s local currencies.
Conclusion
P2P crypto trading ecosystems are a fundamental part of the industry given they are likely the first point of contact for new market entrants. This has since tasked them with the role of providing full-stack platforms when it comes to P2P crypto trading services. One of the cutting edges Bitcoin Global has applied to be a niche P2P crypto trading service provider is the inclusion of an API based advert management feature. The platform also has an ongoing limited offer featuring free BTC transactions.
That said, the P2P crypto market is an area which has been growing significantly in 2020, especially since the onset of the COVID-19 pandemic. Emerging markets in South America and Africa appear to be leading this trend and speculators are now banking on all-time volume highs. While there is so much uncertainty in crypto, the tell signs on a possible macro adoption are already here!