Bisq
Bisq (founded in 2014) is an open-source peer-to-peer application that allows anyone to buy and sell Bitcoin in exchange for national currencies or alternative cryptocurrencies[1][2].
Overview
Unlike existing exchanges, Bisq is fully decentralized and censorship-resistant using alternative protection mechanisms:
- escrow transaction employing 2-of-3 multi-signature address
- security deposits to incentivize following the trade protocol
- a decentralized arbitration system helps resolve disputes
Bisq protects user’s privacy by using a custom P2P network over Tor, in which every user is a participating node. An all-in-one desktop application (for Linux, OS X, and Windows) provides an intuitive user interface and executes the trading protocol.
Bisq protects the privacy between trades by separating each trade with a different set of addresses. Bisq relies on a decentralized arbitration system to ensure that traders fulfill their obligations[6][7].
Bisq Business Model
Bisq is not a company, but an open-source project that aims to fill a gap in the cryptocurrency ecosystem: to provide an exchange platform that follows the same principles as Bitcoin itself. A unique incentive mechanism is set up to support the project:
- Transaction fees go in part to the developers and in part to the arbitrators
- In the event of disputes, arbitrators collect the security deposit of the losing party (or in some cases half the deposit of each party)[4][5].
Features of Bisq
Unlike traditional online exchanges, Bisq is designed to be:
- Instantly accessible – no need for registration or approval from a central authority.
- Decentralized – there is no single point of failure. The system is peer-to-peer and trading can not be stopped or censored.
- Safe – Decentralized arbitration system and security deposits protect traders.
- Private – no one except trading partners exchange personally identifying data. All personal data is stored locally.
- Secure – end-to-end encrypted communication routed over Tor.
- Open – the code is open-source software.
Bisq is for those who do not want to forfeit control or privacy to a central authority in order to trade with other individuals. They regard financial transactions as a form of private speech that should be protected from surveillance by banks, governments, and other institutions[6].