Paxful is a peer-to-peer marketplace for buying and selling Bitcoin which has been around since 2015. The company has maintained an office in the Philippines for some time now (Yes! They have a full team here, not just customer support), In 2019 Paxful began actively marketing in the country.
With prices going up, savvy Filipinos are looking at P2P markets like Paxful to save fees as they acquire more or sell Bitcoin. As a P2P marketplace, Paxful provides an escrow to protect both the seller and the buyer by keeping the Bitcoin and only release it once both parties have fulfilled their side of the transaction. The fiat funds will be transferred from the buyers let’s say gcash account to the sellers gcash account directly.
Paxful P2P vs Spot Trading and Direct Exchanges
As per Usefultulips.org, the Philippines ranked as the 3rd biggest market of Paxful in Asia and 10th in the world. In a previous interview, Apryl Albero, Community Marketing Manager at Paxful Philippines, said Filipinos are savvy during bull and bear markets and always sensibly trying to lock profits.
There are some key differences between a P2P marketplace, a spot exchange, and a direct exchange.
- The buyer negotiates directly with the seller in P2P.
- In spot exchanges, the buyer places an order in an “order book” where all orders are collectively listed.
- In a direct exchange, the exchange sets its buy and sell price.
Paxful is one of the largest P2P marketplaces in the world and has been a key contributor to the proliferation of Bitcoin in Africa and South America. In 2020, Paxful’s market share in the Philippines has increased and appears poised to become a market leader in the P2P space as per publicly viewable data. Licensed virtual currency exchanges in the Philippines like Moneybees and Bloom are vendors on Paxful.
This article will focus on buyers, not the sellers, and also does not constitute investment advice, merely information on how the process of buying through the platform happens. BitPinas does not give investment advice and readers are highly encouraged to do their own research.
Things to Note
Before proceeding with buying through Paxful P2P, take note of the following:
- You must be registered and verified on Paxful.
- You should understand how currency exchange works in general, trading PHP for BTC is similar to trading it for USD.
- Prices in cryptocurrency can change (up AND down) quickly. Always make sure you understand those risks or speak to a financial professional for advice.
Disclosure: BitPinas will receive an affiliate earning if you use our link. Doing so will support the development of the website.
How to Register on Paxful
- Go to paxful.com and click “Get started” and then “create an account.”
- Enter your email address and a strong password.
- Note that you can only change your email within the first 7 days and only if there’s a typo.
- Complete the verification procedures.
- Paxful will send you an email with the instructions to verify your email address.
How to Buy Bitcoin on Paxful
Because Paxful is a marketplace where buyers meet sellers directly, the seller could be here in the Philippines or anywhere around the world. The buyers and sellers agree on a price compared to wallets where you buy or sell based on the wallet’s prevailing rate.
1. Go to Paxful.com
2. Choose from 350+ different payment methods. Popular options here in the Philippines include GCash, PayMaya etc.
Paxful quite possibly has the most number of payment options available out of all crypto exchange websites. Since we are here in the Philippines, we shall choose one that is also available here. For this exercise, we will use PayMaya.
3. Select PHP.
4. Click “Find Offers.”
5. Select from the sellers available:
From the above options, you can also filter it further to highlight, for example, those who will offer receipts, etc.
From the above image, refer to “User Types” on the left side.
- Power Trader – is a special user status given to users who gained “extra trust” and “recognition” on Paxful
- Corporate account – These are corporate entities doing businesses on Paxful. Examples are MoneyBees and Bloom, both are licensed virtual currency exchanges in the Philippines.
- Peer, Ambassador, Associate — users who are part of the Paxful Peer Program. They support Paxful’s marketing initiatives while getting rewarded for their efforts.
You want to look out for these users, as well as sellers with high ratings and trades.
6. Examine the offer page
All details about the seller’s offer will be displayed in this trade. The seller above appears to be selling 3.5% above the market price, has a buy limit of Php 500 to Php 923, and transactions with them have a 1 – 5 mins processing time. The seller also does not have any negative feedback.
7. Enter the amount you want to buy.
Once you enter the desired transaction amount, click “Buy Now” to proceed chatting with the seller.
8. Chat with the seller
Discuss the details of the trade with the seller and follow their instructions carefully.
9. Make the payment.
10. Click “I have paid.”
11. The seller will confirm on their end, release the Bitcoin from the trade escrow and transfer that to your Paxful wallet.
Payment methods accepted in Paxful Philippines
As mentioned there are 350+ payment options available on Paxful but most offers in the Philippines.
- Globe Gcash
- Local banks via Instapay
Some sellers might only want to receive from a particular bank. But almost any bank account can now transfer to and from any other major banks via InstaPay so there’s no need to worry on that end.
Paxful P2P Advantages
- There are 350+ payment options
- You can trade directly with other people around the world
- Both the buyer and the seller are protected because of the escrow system
- Feedback mechanism enforces honesty between buyers and sellers
Escrow system works in such a way that the deal will only go through once both the buyer and the seller agree that the transaction has been fully completed. If one refuses to cooperate, or if one the party decides to be dishonest, the chat log can be used as evidence to bring to Paxful’s customer support.
Because users can put feedback, it is important for both parties to be in their best behavior while transacting.
Tips when buying Bitcoin on Paxful
Here are some tips and things to watch out for when doing P2P trading on Paxful:
Always check the seller’s reputation and activity.
Always be cautious about any seller and pay attention to the negative feedback that appears in their profile. If there are one or two such feedbacks, also check what’s the issue for such negative comments. To be safe engage with sellers with a high positive rating and high number of completed trades.
Read the terms of the offer before starting to trade
Sellers are the ones who set the conditions of the trade. Some of them may have specific instructions that are presented to the buyer at the beginning of the trade. Make sure it is something you can meet and follow. For example, some sellers may require that you disclose your name, upload a photo of your ID, and provide a mobile number. This is true for corporate accounts, who need those details for accounting purposes. Some sellers may have special payment-related procedures that may delay the release of Bitcoins for a longer period. In that situation, the buyer should understand that the Bitcoin transfer might be delayed for a bit. Of course, Paxful requires sellers to release the Bitcoins within the time stated on the transaction.
Watch out if suddenly the conditions initially set up are changed as you go through the transaction process. For example, if the seller initially said they do not allow “third party” accounts (meaning they want to receive the payment from a bank account under your name), but suddenly allows third party accounts during the chat conversation, this should be treated as a red flag and do not think they are doing this favor to you out of the goodness of their heart. We’re serious here.
Be on the lookout for the best deals
Sellers on Paxful have different prices to offer for their Bitcoins. It may be because of the bank fees or the local currency conversion fees. There’s almost always a better deal for you on Paxful. One way to check it is to find which offers give you the most on the dollar. The higher the number, the better that deal is for you.
What is “On the dollar” in Paxful?
The “on the dollar” amount tells you if a trade is the best deal for you or not. What does it tell you? For example, if you buy Bitcoin via bank transfer at the rate of $10,674.9 per BTC with a fee of 5.2%, that means for every $1, you get $0.95 worth of BTC. With this example, if you proceed to buying Bitcoin for $100, what you’ll get is $95.1 worth of BTC or 0.00936865 BTC.
So remember to check the “on the dollar’ rate before trading. Whether or not that is profitable will be determined by the future price of Bitcoin. From the example above where the price of Bitcoin was $10,674.9 and the price of Bitcoin at the time this article is written ($33,000), I think it’s pretty profitable.
Only click “Paid” when you actually do so
According to Paxful, the “Paid” button is there to provide security from dishonest or forgetful sellers. On the reverse, if the buyer clicked it without having really paid, the seller might think the buyer is a scammer. So it’s better to only click it once you have really already paid.
Don’t ask the seller to release Bitcoin first
Paxful said if you do this, you will be banned instantly. Paxful is an escrow, so the Bitcoin is waiting to be released once you’ve already paid on your end.
Do not make deals outside Paxful
Do not, at any point, try to move the conversation away from the website’s chat system. Paxful won’t be able to help you if you get scammed because of this.
Publicly available data reveals Paxful has seen success in the Philippines, meaning there is appetite amongst Filipinos to trade via P2P.
With multiple payment options (over 300 ways to buy Bitcoin), a global buyers and sellers, and as the biggest P2P marketplace in terms of number of transactions and volume, Filipino vendors who want to make money with arbitrage should consider global liquidity as a major factor, which Paxful has. The community is big in the Philippines too. You can head out to Paxful’s Telegram channel if you ever need support.