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].


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:

  1. Transaction fees go in part to the developers and in part to the arbitrators
  2. 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].

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October 12, 2022


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