Bisq's vision for trading cryptocurrency shares many of our own philosophies, notably:
Do not want to trust any exchange for holding your funds.
Do not want to forfeit control or privacy to a central authority in order to trade with other individuals.
Regard financial transactions as a form of private speech that should be protected from surveillance by banks, governments, and other institutions.
Bisq Network is developed with the belief that allowing centralized exchanges to dominate cryptocurrencies' ecosystem is not only an immense downfall for what crypto stands for, but also makes crypto's ecosystem vulnerable.
And they definitely would not be wrong, just check out our long list of documented cryptocurrency exchange hacks if you have any doubts. Another reason I wanted to write a tutorial on how to buy Bitcoin via Bisq, is because much like Saturn Network they are working towards creating a model which is self-sustaining and censorship-resistant by forming a DAO.
The goal is that once Bisq DAO goes live, not only will trading on Bisq be decentralized but project decision-making and revenue distribution will also be decentralized - thus removing any centralized points that could amount to vulnerabilities & failure. So let's dive straight in and learn how we can make our first trade!
Table of contents
- Download & Install Bisq
- Adding a national currency account
- Encrypt & backup your wallet
- Security deposit & trading fees
- Take an offer buy or sell bitcoin
- Confirming your trade
- Send payment
- Complete trade
How to start buying or selling Bitcoin via Bisq?
First, you will need to download and install Bisq, as it is not possible to trade on their website. Make sure you use an official link from their downloads page. The reason you have to use software to interact with the exchange is because it does not run on a centralized server. Bisq runs entirely on a peer-to-peer network, much like how torrenting works, it stays online due to a global network of users running Bisq on their own hardware. This means that unlike centralized services, Bisq Network would be extremely difficult to monitor, block or shut down.
When you launch Bisq, it could take a few minutes to connect through TOR and sync up with the trading network - this all depends on your connection speed. But once that is done you should be greeted with a screen that looks like this:
Adding a national currency account
As we want to buy bitcoin, first click on Buy BTC in the top menu. This should take you to the offers page which you can filter by your preferred currency. However, you will notice that everything is greyed out & you cannot click the green Take offer buttons.
This is because before buying any Bitcoin, we need to configure a way to pay for the bitcoin. Obviously, you need to use a payment method you have access to and ideally is listed on an existing offer. One thing to note is that a Bisq offers only appears when that user is available & online, so do not get discouraged if you do not see your preferred payment method on the list - it may pop up later as Bisq users go online & offline during the day.
As you can see on the screen above, Zelle is a popular payment method in the USD market so in this tutorial we will configure a Zelle account. If you are using EUR, then it will most likely be via a SEPA transfer or if you are using GBP then it will probably be a Faster Payment. Just adapt the tutorial to the payment method you choose to use.
You need to click on Account and then click Add new account. Select your payment method and fill in the appropriate details, you do not need to change anything in the Salt field. You also have an Account name box, this is optional and only displayed internally for you.
Before you click the Save new account button, do be sure to double check all the information. If anything is wrong, then your trade is not going to be successful & your trading partner will not be very happy at all. Now return to the Buy BTC screen, and you should see some offers are now enabled for you:
Encrypt & backup your wallet
Bisq has a built-in wallet which makes trading much easier, as funds will be available and ready if you decide to accept an offer. It is not required, but it does make your life easier. As always you need to back up your wallet seed phrase, just in case you need to recover your account. So click on Account and then open up the Wallet seed section. Make sure you store your seed words safely (pen & paper)!
You will also see a Wallet Password section, this is equally important as otherwise your Bisq wallet files are not encrypted. If you set a password then your Bisq wallet files become useless without the password - an extra layer of security against hackers!
Security deposit & trading fees
Before you can proceed to buy or sell bitcoin you will need to fund your Bisq wallet to cover a security deposit as well as pay for trading & mining fees. As a way to prevent fraud & keep everyone safe, when you execute a trade on Bisq both traders (buyer & seller) are required to post a security deposit. This means to use Bisq you will need access to 0.011 BTC.
If you do not have this amount, I recommend finding someone you trust to buy bitcoin from directly, you could try hitting your local crypto meetups. Avoid using a centralized exchange, as this will simply mean your Bisq wallet is now being tracked (which defeats the purpose of using Bisq in the first place!).
You can find your wallet addresses by clicking on Funds and then on the Receive section.
This is not a requirement, however, without any bitcoin in your Bisq wallet, you will need to transfer the security deposit & fees manually when you make a trade.
Take an offer to buy or sell bitcoin
We are now ready to start trading, congratulations! Go back to the Buy BTC screen and find an offer that interests you, then use the Take Offer button.
You will then be greeted with the Fund your trade page, this is a special wallet that Bisq has created to hold your security deposit and funds. It will be used to pay for your taker fee and will also send your security deposit into a multisig escrow transaction with the seller's deposit and the bitcoin you are buying.
This multisig escrow transaction allows the bitcoin to be traded securely & safely by requiring multiple signatures before it is released.
Once both sides of the trade have been completed then you will receive the bitcoin you bought along with your security deposit & the seller will receive their security deposit back also. Bisq will display the address of the trade wallet and the exact amount you need to send to it, if you funded your Bisq wallet you can simply click the Transfer funds from Bisq wallet button.
Confirming your trade
Once the trade wallet is funded, a new button will appear labelled as Review: Take offer to buy bitcoin. Click it to proceed to the next screen which will look something like this:
At this point in time, you need to check all these details are correct. Because once you proceed, there is no longer any possibility of backing out of the trade. You have to continue after this point or do risk losing your deposit.
If everything looks good, then click on the Confirm: Take offer to buy bitcoin button. I know that this is taking a long time to buy some bitcoin, some of you may even be getting a little frustrated! But remember, we are using a truly decentralized, peer-to-peer, non KYC/AML, non-custodial exchange and this is a great thing.
You have now reached the step where you need to pay the seller, you will see a payment details box pop-up. Please note Bisq waits for the Bitcoin network to start confirming the trade's confirmations(for the escrow), so on average it will take 10mins for the payment details box to appear:
You can wait as long as you want before sending the payment, however, do note the max allowed duration for completing the payment(it will be different depending on the chosen payment method). The seller must receive your payment before this timer runs out!
Once you have sent your payment, you need to click on the Payment started button. This is a crucial step as it tells Bisq you have made the payment and sends a notification to the seller to let them know the payment is en-route.
If you forget to click this button, then the seller will probably not be on the lookout for your payment & you may never get your bitcoin! So be sure you don't forget.
Now we sit back and wait for the seller to receive your payment. As soon as they mark it as received, Bisq will automatically complete the trade and release your bought bitcoin along with your security deposit.
Then you just have to decide if you want to keep your shiny new bitcoin in Bisq wallet or click Withdraw to External Wallet if you need to send it to another address.
Hurrah! Pat yourself on the back, you have just completed your first trade on Bisq and bought bitcoin without needing to give up all your personal details.
KYC? Never heard of it - I thought crypto was decentralized?