Bisq — A Peer to Peer Bitcoin Decentralized Exchange
Tags: bitcoin, bisq, cryptoexchange
Published: 2020-03-03 16:51:11

---
title: Bisq — A Peer to Peer Bitcoin Decentralized Exchange
published: true
date: 2020-03-03 16:42:09 UTC
tags: Bitcoin,bisq,bitcoin,crypto-exchange
canonical_url: https://blog.coincodecap.com/bisq-a-peer-to-peer-bitcoin-exchange/?utm_source=rss&utm_medium=rss&utm_campaign=bisq-a-peer-to-peer-bitcoin-exchange
---

How can you build a decentralized future using centralized tools? However, this is what we are doing today in the case of centralized exchanges. 

Unless we have completely decentralized censorship-resistance tools for money exchange, we will always be beholden to fiat currencies and governments to permit our economic transactions.

Multiple decentralized exchanges (DEX) are trying to solve these problems. In this article, we will talk about [Bisq](https://bisq.network/?utm_source=coincodecap.com).

> **Also Read: [A Candid Explanation of Bitcoin](https://blog.coincodecap.com/a-candid-explanation-of-bitcoin/)**

### What is Bisq?

[Bisq](https://bisq.network/?utm_source=coincodecap.com) is a **decentralized P2P [Bitcoin](https://blog.coincodecap.com/tag/bitcoin/) exchange**  best understood in terms of its major component parts:

1. It is a cross-platform  **desktop application**  that allows anyone to buy and sell [bitcoin](https://blog.coincodecap.com/tag/bitcoin/) in exchange for fiat and other cryptocurrencies.
2. Bisq is a  **trading protocol**  that enables peer to peer trading exchange, eliminating the need for trusted third party exchange services.
3. It is the  **peer-to-peer network**  formed by Bisq applications discovering, connecting to, and working with one another to implement the Bisq trading protocol. The network is _fully_ peer-to-peer in that it requires no centrally-controlled servers and has no single points of failure.

[Bisq](https://bisq.network/?utm_source=coincodecap.com) is  **not a company**. It is  **free software**  released under version 3 of the GNU Affero General Public License.

**Also Read: [Convert Bitcoin – Best Crypto Exchange Services](https://blog.coincodecap.com/convert-bitcoin-best-crypto-exchange-services/)**

### **Who will use Bisq?**

Bisq is built for those who:

- Want to exchange fiat currencies such as euros, dollars or yen, and other cryptocurrencies such as Monero or [Ethereum](https://blog.coincodecap.com/tag/ethereum/) for bitcoin.
- Do not trust any centralized exchange with their funds.
- Want privacy when trading with other individuals.
- Avoid financial surveillance by banks, governments, and other institutions.

### How to use Bisq?

In order to use the software, you need to install it. It is available for all mainstream operating systems. Use [this download page](https://bisq.network/downloads/).

Once downloaded and installed, open the application. It automatically connects with the [Bitcoin](https://blog.coincodecap.com/tag/bitcoin/) nodes run by Bisq contributors. However, if you are running a local Bitcoin node, Bisq application automatically finds it. 

The application contains an internal Bitcoin wallet. Upon starting the app, write down your seed phrase and backup your wallet data. You are responsible for your own funds since the rest of the Bisq network has no access to them.

#### **Adding Fiat and Cryptocurrency Account**

Bisq supports the most popular fiat payment networks such as AliPay, MoneyGram, Western Union, Bank transfer, etc. In addition, it also supports multiple cryptocurrencies. So you need to create an account of the particular payment method to execute a trade of that payment type.

So, for example, if you want to buy or sell [Bitcoin](https://blog.coincodecap.com/tag/bitcoin/) using MoneyGram, you need to add your MoneyGram account in Bisq. However, this information never leaves your device and only share with your trading partner. 

#### **Deposit Collateral**

Anyone can make an offer to buy or sell BTC. When you take someone’s offer, under the hood, your Bisq communicates it with your trading partner.

Both of you need to make a security deposit as insurance against potential fraud by either of you. That deposit is locked in 2-of-3 [Multisig](https://en.bitcoin.it/wiki/Multisignature), which includes you, your trading partner, and an anonymous Bisq arbitrator.

This security deposit can only be unlocked if two out of three people agree. In the event of a dispute, an arbitrator investigates the trade and determines the right course of action.

#### **Bisq Dao**

Bisq is not a company or legal entity. It is free software, governed by a decentralized autonomous organization (DAO). To learn more about Bisq Dao, check out the following video.

<iframe title="Bisq DAO in Brief: What &amp; Why of the Bisq DAO" width="640" height="360" src="https://www.youtube.com/embed/videoseries?list=PLFH5SztL5cYPAXWFz-IMB4dBZ0MEZEG_e" frameborder="0" allow="accelerometer; autoplay; encrypted-media; gyroscope; picture-in-picture" allowfullscreen></iframe>

#### Wrapping up…

Bisq (previously Bitsquare) started in 2014 and since then processed more than 49K trades. Decentralized exchanges are important for exchangeability between different cryptocurrencies independent from centralized exchanges.

As Decentralized exchange technology is getting better, we will see more DEX in futures, hoping to replace centralized exchange in the near future.

**Also Read:**

- [Ethereum versus Bitcoin](https://blog.coincodecap.com/ethereum-versus-bitcoin/)
- [Common Crypto Questions](https://blog.coincodecap.com/common-crypto-questions/)
- [An ultimate guide to Bitcoin Paper Wallet](https://blog.coincodecap.com/what-is-bitcoin-paper-wallet/)
- [Earn Crypto – Passive Income by Staking Coins](https://blog.coincodecap.com/earn-crypto-by-staking-coins/)


The post [Bisq — A Peer to Peer Bitcoin Decentralized Exchange](https://blog.coincodecap.com/bisq-a-peer-to-peer-bitcoin-exchange/) appeared first on [CoinCodeCap Blog](https://blog.coincodecap.com).