The P2P exchange site essentially uses the user’s location and that of other users of the site to match buyers and sellers who are close in a geographical sense. Thus, those who want to buy or sell bitcoin do not have to search far or deal with people who are very far away from the buyer/seller. LocalBitcoins searches and finds bitcoins for you that are “local”, hence the name LocalBitcoins.
LocalBitcoins serves more than 200 countries and territories on its platforms. The countries that are not served are excluded either by international financial restrictions or regulatory prohibitions. Unserved countries include the United States, China, Indonesia, Syria, and North Korea.
What cryptocurrency pairs are traded on the LocalBitcoins platform? All trading and exchange services have Bitcoin paired with various fiat currencies such as USD, Euro, British Pound, etc.
Deposit and Withdrawal
Transactions on LocalBitcoins are made from one individual to another. Therefore, only payment methods that allow P2P (i.e. person-to-person) transactions are allowed on the LocalBitcoins platform. Therefore, LocalBitcoins allows its users to make deposits and withdrawals through the following channels:
- Bank transfer
- Mobile money (selected countries)
- Western Union
- Cash by mail
- Cash (made in person)
The best rates are obtained when you use payment methods that are not easily reversed. Therefore, buying with a payment method like PayPal is more expensive than a physical money exchange because of the added risk of a reversal with PayPal.
For those who want to know what fees they may incur by using LocalBitcoins, below is a guide to the fee schedule for using LocalBitcoins. Bitcoin trading (i.e. buying and selling Bitcoin) is completely free of charge. Those who advertise their Bitcoins for sale to other LocalBitcoins users who wish to buy are usually charged a 1% fee on all completed trades. Sending bitcoin to the wallets of other LocalBitcoins users is also free. However, the Bitcoin network itself charges a fee for the transaction.
In other words, LocalBitcoins does not charge for sending bitcoin, but the network does charge a fee (which is used to compensate those who confirm transactions on the blockchain network). This network fee is not static, but varies with the amount. Merchant invoicing carries a service fee of 0.5%, which is taken from the invoice amount. There is also a cost associated with paying invoices via external transactions. For custom projects (e.g. research), a fee of 200 euros/hour is charged. This amount is payable in Bitcoin at the most current BTC/Euros exchange rate. There is no limit to the amount of cryptocurrencies that can be traded on LocalBitcoins.
What security measures does LocalBitcoins implement to secure its customers’ cryptocurrency holdings? The following measures have now been implemented.
2FA, also known as 2-factor authentication, allows users to use an additional login PIN after entering their primary credentials into the account. The use of 2-factor authentication is an additional security measure that helps prevent account hacks, especially when an unauthorized third party has gained control of the primary credentials. The user is expected to enable it if this feature is desired. It is not enabled automatically or by default.
- IP address confirmation: LocalBitcoins usually identifies and stores the IP address of the computer used to create the account. Exchange website robots are also able to record the browser that is constantly used to log in to the LocalBitcoins account. When the user moves to a new location, uses a new computer or browser, or travels to a new country, a verification process is performed via email to confirm the identity of the person using the account.
- KYC: A Know-Your-Customer system is in place to give all users of the LocalBitcoins Exchange website a verifiable identity. This helps prevent fraudsters from using the Exchange to steal Bitcoins from authentic users.
Escrow Payments: All transactions are covered by escrow protection. Cash is only released for Bitcoins that have been confirmed as sent.
LocalBitcoins does not offer a fixed wallet. Therefore, users are advised to put all their unlisted bitcoins in a cold wallet and only put the ones they want to sell in the hot wallet.
LocalBitcoins’ support services are available 24/7. The available methods include:
- Twitter (www.twitter.com/LocalBitcoins)
- Instagram (www.instagram.com/LocalBitcoins)
- Email (via the online contact form)
- Support ticket
However, only the social media channels guarantee fast service. Support tickets opened on the website can take up to 10 days to get a resolution.
Advantages and disadvantages
- Competitive fee structure (most services are free).
- There are payment channels that take into account country specifics. For example, while MTN Mobile Money works in Ghana, PayPal will work fine for Europe.
- There are multiple levels of security for users on the exchange.
- There is no shortage of buyers and sellers as the exchange has a map that matches sellers with buyers in their region.
- Customer support is very slow.
- The lack of a hard wallet system means that users have taken responsibility for protecting their wallets.
Where is LocalBitcoins located?
LocalBitcoins headquarters is located in Helsinki, Finland.
How can I fund my LocalBitcoins account?
There are many options you can use to fund an account with LocalBitcoins. Check the article to see which method is available in your region.
What is the average withdrawal time at LocalBitcoins?
LocalBitcoins sets a maximum withdrawal time of 12 hours. However, the typical withdrawal time is much shorter and is one to two hours.
Is LocalBitcoins safe to use?
LocalBitcoins offers several layers of security to protect its users. In addition, there are several checks and balances in place to protect users during transactions. One of them is the escrow system, which ensures that payments are not released until all parties have fulfilled their obligations.
Is LocalBitcoins legitimate or is it a scam?
LocalBitcoins is a legitimate company that has been around since 2013. There have been very few complaints of fraud, which in most cases were the result of doing business with users without a track record. Deposits and withdrawals are handled with shipping, and that is why more and more people are signing up in many countries.