5.6 Managing Trading Risks

P2P trading involves several types of risk that traders should understand. Counterparty risk is the possibility that the other party in a trade does not fulfill their obligations. CryptoBazaar's escrow system significantly mitigates this risk but does not eliminate it entirely.

Payment risk includes the possibility of payment failures, delays, or reversals. Using reliable payment methods and verifying payments carefully reduces this risk.

Market risk exists because the INR/USD exchange rate can fluctuate during the time it takes to complete a trade. For most trades completed within minutes, this risk is minimal, but for delayed trades it can be significant.

Diversify your trading activity. Do not put all your capital into a single trade or trade exclusively with one partner. Spreading your trades across multiple partners and amounts reduces the impact of any single problem.

Set personal trading limits based on your risk tolerance. Decide the maximum amount you are willing to trade in a single transaction and stick to it.

Stay informed about common scams and new fraud techniques. The threat landscape evolves, and awareness is your first line of defence.

Use all available platform features including escrow, dispute resolution, and feedback systems. These exist to protect you and are most effective when used consistently.