LocalBitcoins is a peer to peer exchange platform that was launched in 2012 in Finland. Unlike other exchanges that determine the rules of trading, on LocalBitcoins, buyers and sellers agree on their terms of trade. The platform serves as a safety net by holding the seller’s cryptocurrency and buyer’s fiat currency on escrow. Users are not required to undergo verification apart from in cases of high volume trading.
Offers a private platform for trading cryptocurrencies
Accepts over 50 payment options
Does not impose trading limits
Traders risk encountering scammers
Speed of transaction is dependent on the seller’s confirmation of sale
Traders do not have a way of checking each other’s reputation
LocalBitcoins is available worldwide except in Germany and New York. It initially had a presence in New York but withdrew after facing stiff competition from Bitlicense.
LocalBitcoins accepts a wide range of payment options including debit and credit cards, wire transfers, electronic cashiers such as Skrill, NETeller and GiroPay among others. The buyer and seller conducting a given transaction consult with each other to determine the most suitable payment method for them. It is advisable not to use or accept a payment method that is reversible such as PayPal they are more prone to scams.
LocalBitcoins establishes a reputation rank for all traders who have previously used the platform according to their past activities. Escrow services offered by the exchange ensure that payment is delivered once the seller has confirmed a transaction.
Traders joining the platform use a 2-factor authentication process to login into their accounts. It has also put in place a logion guard depending on a user’s IP address. If a trader attempts to login from a different location, they will be required to verify the transaction via their email.
LocalBitcoins serves as a mediator to resolve conflicts that arise between the buyer and seller. Traders must take caution when meeting prospective buyers/sellers to avoid being conned.