Before getting into the concept of Decentralized P2P Ecosystem let us understand what decentralization means.
Decentralization– refers to the noninvolvement of any third party to facilitate the transactions between two individuals. In another way, we can say that all these processes take place with the help of blockchain technology which is irreversible and also immutable. Let me get into the details- On a decentralized Exchange Platform (where the cryptocurrencies can be exchanged between the individuals ) if A(name of an individual) wants to trade his bitcoins, then he uses the trade match engine where he can get an individual “B“ who will accept to buy the Bitcoins from A in return for fiat or other Crypto.
Then A and B carry out the transaction using their wallets. Once the transaction is been carried out, a block is been created and the details of the transaction is then stored in the block which is then added to the Chains of blocks already created. This technology is called Blockchain technology. The block created will be stored in each and every node (Users) of the Network (Exchange Platform) making it immutable and irreversible. All the transaction details in the block will be stored in the cryptographic from. Each and every block can be differentiated based on the different hash codes on the blocks. This technology makes it possible to send funds to even unknown individuals.
This is the whole process that takes place in the Decentralized Ecosystem and a centralized model of exchange is similar to banks.
Now let see about P2P mode of Exchange
The Peer to Peer exchange is one of the old forms of exchanging Cryptocurrencies among the known parties. We can directly say it as a “person to person” mode of transaction. P2P platforms match the people who make the orders in order to carry out the process.
A buyer and seller in a P2P network post a trade ad in order to carry out a transaction at a specific price range at a defined location. It would be just like Quikr, eBay or Craigslist where the direct interaction between the buyer and the seller takes place. So, if the seller wants to buy a bitcoin at a specified place, then locally the P2P exchange will connect to the person who wants to sell a bitcoin. This method makes it easy for both parties to carry out the transaction at the right time and the right place at a negotiable price with a payment mode which will be easy for both parties. But all these take place in a centralized way.
Now I guess you would have got an idea about what the Combo of Decentralized P2P ecosystem may involve. It will have Blockchain technology in P2P exchange mode of transactions in order to have secured transaction.
This will be revolution in various industries such as hospital services, Supply chain and logistics, Real estate, financial institutions etc.
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