What is Bitsquare ?
Bitsquare is a peer to peer Decentralized Bitcoin and crypto currency or Alt Coin Exchange that doesn’t rely on a central third party to be the custodian of your coins.
This means that , in theory , it is resistant to the types of hacks that have happened to countless Bitcoin exchanges such as Mt Gox, Cryptsy and now Bitfinex.
It works by attempting to automate, using code, the role that the exchange plays in holding coins in a wallet on your behalf. This custodial role that regular Bitcoin Exchanges play is prone to hack and attack in several ways , hence the need for a more secure way to do this.
It deploys a multi signature method of making storage and transactions of coins on a peer to peer basis between traders and investors more secure. More technical details on how this works can be found on their website Bitsquare.io
They also try to automate a dispute mechanism when trades don’t always go to plan and this involves various ways to Arbitrate and settle disputes when they arise.
Bitsquare also uses the TOR browser system to try and make trades in the exchange more anonymous so privacy is further protected if desired.
This is truly groundbreaking technology as just like Bitcoin is trying to automate banking payment functions bitsquare is essentially doing the same for a complete stock exhange. Therefore you have the majority of the functionality of a stock exchange with very little staff required and very low fees. With the project being open source anyone can look at the code and replicate or improve this and it will be virtually impossible to stop.
Bitsquare is still very early on its development and new releases and patches are currently frequent so more testing and upgrades need to be done. It is also fairly illiquid currently so not too many people are currently actively trading and making it difficult to find a market and prices in some cases.
However this is likely to change with the increase in hacks at Bitcoin Exchanges where millions of dollars is held under custody on behalf of investors and traders.
So what next?
Volumes in Bitsquare are likely to increase and development will accelerate and once again the Bitcoin community and Crypto currency revolution grows stronger to attacks and will be better for it. This is truly amazing technology and the obvious next step in the crypto movement. It seems with each attack the development of countermeasures to avoid this accelerate.