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P2P model (peer-to-peer model)

The peer-to-peer model (P2P model) is a non-hierarchical system of exchange, transfer or transmission. The P2P model may replace a conventionally top-down hierarchical system or it may be central to the design of a new system.

P2P is commonly spoken of in relation to networks. Peer-to-peer networking is a decentralized communications model in which each party has the same capabilities. Each computing device on the network can function as either a server or a client and any party can initiate a session. Similarly, members of a P2P cloud dedicate their computing resources to establish a single-purpose cloud architecture.

The P2P model is increasingly the underlying structure for systems that replace a current system with one that’s more advantageous to group members. The sharing economy, also known as collaborative consumption, is a P2P system that allows members to trade amongst themselves, barter for goods or borrow infrequently used items rather than having to purchase them from an external party whose model requires making a profit on transactions.

P2P lending, similarly, is a system in which members can borrow funds from other members. P2P lending can make access to loans possible for people who might not otherwise have access to funding. Peer-to-peer education is a collaborative model in which learners are also teachers, sharing information and helping each other gain mastery of their particular areas of difficulty.

This was last updated in September 2019

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