Peer-to-peer (P2P) Bitcoin (BTC) marketplaces remain an important cog in allowing users to move money across borders, but their future depends on becoming permissionless and unstoppable according to Paxful’s Ray Youssef.
Youssef, alongside Nicolas Gregory and Antoine Riard, is driving the development of Civ Kit, a P2P marketplace that will leverage the technology of Nostr and the Lightning Network to power a decentralized platform allowing censorship resistance and permissionless trading among peers.
Youssef spoke exclusively to Cointelegraph’s Joe Hall at the Surfin’ Bitcoin conference hosted in Biarritz, France about the in-development project that is aiming for an alpha release toward the end of 2023.
According to the white paper co-authored by Youssef, Gregory and Riard, the Civ Kit system will use the Nostr protocol for its P2P order book and rely on the Bitcoin network as a source of truth for its “web-of-stakes” market ranking paradigm.
Trades are set to be locked under Bitcoin contracts to remove reliance on third parties for dispute arbitration, while market nodes will be incentivized by privacy-preserving service credentials backed by BTC payments.
The white paper outlines the aim of its market system enabling global trade of any kind of item around the world, including fiat currencies, goods and services.
According to Youssef, P2P marketplaces are popular but perceived as niche within the Bitcoin ecosystem. While most cryptocurrency users think of spot or futures exchanges and marketplaces when they consider trading, Youssef said that P2P trading — or over-the-counter (OTC) trading of money using cryptocurrencies as a kind of clearing layer — is bigger than users might think:
“It started with guys on Bitcoin Talk trading and then LocalBitcoins came out, then Paxful came out. Then ‘CZ’ [Changpeng Zhao] stole my shit and launched Binance peer-to-peer.”
Youssef admits that Binance’s P2P marketplace is now the biggest player in the ecosystem, noting that private conversations with Binance’ founder Changpeng “CZ” Zhao suggest that the offering remains a top earner for the global cryptocurrency exchange’s business as spot markets struggle to generate big returns.
The impetus for the creation of Civ Kit is partly born over fears of the potential closure of P2P platforms like Binance’s. Youssef said that a real concern is the lack of an alternative for P2P users that depend on these services to move money across borders.
“It’s not about trading; it’s not speculative. They’re literally trying to make the money flow and use their money in ways they couldn’t use before. Peer-to-peer is the only avenue for that.”
“Fraud is a tremendous concern; regulation is a tremendous concern, and the risks are huge. It’s ‘Operation Choke 2.0.’ They’re trying to shut down all the on-ramps and off-ramps into crypto, into Bitcoin.”
Youssef also stressed that P2P marketplaces need to be built in ways that make them “unstoppable” and “permissionless,” highlighting that both Delaware-based Paxful and Finland-registered LocalBitcoins faced closure despite their vastly different geolocations.
As Cointelegraph previously explored in an in depth follow up, P2P exchanges have faced significant regulatory scrutiny and uncertainty in countries such as the United States.
The SEC and Binance filed a joint motion to pause their legal case for 60 days, citing the newly formed SEC Crypto Task Force’s potential impact on regulations.
Crypto’s rapid growth brings new risks. As fraud escalates, can verification technology keep pace? AI, biometrics and regulatory shifts shape the future of secure crypto onboarding.
Has Sir Keir Starmer picked a fight with a bat tunnel that – in time – he will eventually discover he just can’t win?
For the last six months, the prime minister has singled out the most hated construction site in Britain for criticism – a kilometre-long, £100m shed to protect bats in Buckinghamshire from the high speed trains of the future.
Sir Keir regularly thunders that this is the emblem of a broken planning system. His chancellor says such things will never happen again. But is their joint political sonar advanced enough to avoid a collision in the coming months?
Recent weeks have seen a slew of announcements from Number 10 to prove they are taking on the “blockers” in order to get Britain building.
But government sources conceded to Sky News they are yet to reveal a plan which would stop such structures having to be built again in future.
HS2 will continue to build this bat tunnel, due to be complete in 2027, come what may. A compromise plan – that would see developers pay into a single government-controlled pot – has left experts and industry figures unimpressed, saying it would not stop another bat tunnel.
The experts also warn that they struggle to see how the government prevents future absurd and costly structures without repealing nature and habitat laws we inherited from the EU.
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To roll back on these protections would mean not only war with the environmental movement, but also breaching our trade agreement with the EU – all to get Britain building again.
There is no obvious answer, yet ministers on Monday insisted one is still coming soon.
This comes as today Sky News shows the first ever pictures of the HS2 bat tunnel, showing the scale and breath of the ten-figure development through the Buckinghamshire countryside and taken despite our request for permission to go on site by the government-owned company being declined.
By scrambling through trees and trudging through muddy public footpaths, we were able access open space close enough to the structure, to film the site in detail with a drone without crossing into HS2 land – and it makes quite the spectacle.
Three miles north west of Aylesbury, cutting through the countryside like a scar and wedged between two industrial waste incinerators, we show from the sky the roofless skeleton of the kilometre-long shed which will insulate railway tracks being built in Buckinghamshire – and protect the bats.
The aim is to stop a rare breed known as the Bechstein, which lives in an ancient woodland adjacent to the route, from hitting future high speed trains when they run from London to Birmingham.
The entire structure exists so that HS2 can comply with “The Conservation of Habitats and Species Regulations 2017” – a set of regulations which protects rare species, derives from the EU Habitats Directive and remains in force in the UK to this day despite Brexit.
Although often wrongly summarised as meaning “no bat death is acceptable”, regulator Natural England did advise HS2 that to comply with this law, the company would need to maintain the “favourable conservation status” for the 300 bats once construction was complete. No easy feat.
HS2 executives mulled digging a tunnel, noise-based deterrents and rerouting the line, which would slow down the High Speed trains and prove too expensive. They also looked at barriers alongside the railway or a looser netting structure over the railway – but none of these would have been guaranteed to deliver the standard of protection required by law.
But their engineers and consultants advised the cheapest, legally safest route was the shed being built today. And after four years of meetings with the local council, construction began and continues to this day.
The government’s growth mission champion, Dan Tomlinson MP, who visited the bat tunnel site with Sky News, said reform is vital.
“We need to find a way to reduce the cost of infrastructure in this country. Yes, protecting our wildlife too. But if we don’t do that, we won’t be able to build and we won’t be able to make this country grow again, which is something that’s been lacking for so long,” he told me.
But can they stop this in future? The government insists the answers will come in as-yet-unpublished future planning legislation and yesterday government doubled down on its ambition.
“Spending vast sums to build a ‘bat tunnel’ is ludicrous,” said a spokesman.
“For too long, regulations have held up the building of homes and infrastructure, blocking economic growth and doing little for nature. That is why we are introducing new planning reforms and a nature restoration fund to unblock the building of homes and infrastructure and improve outcomes for our natural world. This will deliver a win-win for the economy and nature.”
But a nature restoration fund may not provide all the answers, according to experts.
Under this plan, the government is proposing that developers who potentially fall foul of habitat and nature rules give money to a pot to fund delivery of wider strategic projects that help nature, rather than trying to compensate for each potential breach of the habitat regulations.
Lawyers think that the idea of a fund makes sense for groups of projects affecting exactly the same species and habitat, but the majority of problems arise where a single project creates its own issues – as is the case of HS2 and the bat tunnel.
“The concept of pooling funds for a grand compensation project which ticks the habitats regulations box for a number of projects onshore therefore seems challenging,” wrote Catherine Howard from law firm Herbert Smith Freehills.
“It is certainly going to take a lot of time, effort and cost for the government or regulators to think through what sort of onshore strategic compensation might need to be put in place, and then to deliver it.
“Can decisions be made in the meantime reliant on the promise that such compensation will come forward?”.
But if there isn’t a compromise option which appeals to ministers, repealing or downgrading habitat and nature rules is the only option.
This, however, would be likely to put the UK in breach of a number of international treaties, including the Trade and Cooperation Agreement entered into by the UK and the European Union in April 2021 to govern post Brexit relations and maintain a “level playing field”.
Pro-growth pressure group Britain Remade says while promises of stopping future bat tunnels should be applauded, “there is a real risk is that if their planning bill doesn’t include changes to inherited EU law on protected sites and species, we’re stuck with the worst of both worlds: a status quo that stops us building and also fails to protect the countryside”.
But attempts to change those laws would cross a red line for environmental campaigners. The RSPB, which has 1.2 million members, is already sounding the alarm over the rhetoric from Sir Keir and Rachel Reeves.
Chief executive Beccy Speight told me while some parts of government are taking a “constructive” approach, her organisation would fight any attempt to water down the nature laws.
“I’m am absolutely clear that we can’t go backwards in terms of the protections we already have in place for nature, because nature is on its knees and we need to do something about that,” she told Sky News.
Sir Keir has made ending ludicrous bat tunnels the test of his planning reforms time after time. This could prove a much trickier issue than anyone anticipated.