Bitcoin is most of the time slower and more expensive in terms of money transferring, compared to other services offered by forex and banks.
LocalBitcoins is a different kind of exchange which allows people to trade Bitcoins from anywhere in the world.
What is LocalBitcoins?
LocalBitcoins is a peer-to-peer Bitcoin exchange platform which offer sellers and buyers from all corners of the world to gather and trade Bitcoins. They agree on the transaction terms, and LocalBitcoins acts like and escrow while facilitating the transaction.
Founded in 2012 by Jeremiah Kangas, LocalBitcoins has evolved into one of the world’s largest Bitcoin exchanges. The company has its headquarters based in Helsinki, Finland, operating in over 200 countries and 14000 cities.
As we’ve mentioned before, this trading platform enables sellers and buyers to make online or face-to-face Bitcoin transactions. LocalBitcoins matches people that live in close proximity to one another.
For those only interested in buying Bitcoins, there are no charges. If you’re selling, the site takes a commission of 1%. It must be noted that once the Bitcoins have been transferred into your personal account, you will be required to pay standard Bitcoin network fees to relocate your funds into your personal Bitcoin Wallet.
It is recommended you do not leave your Bitcoins on your LocalBitcoins account and to try to move them as soon as you’re finished transacting into your more secure Bitcoin wallet.
Sellers do not charge a transaction fee, but they do charge higher exchange rates so they can make a profit.
You can pay through a variety of payment methods such as PayPal, wire transfer, Western Union, Moneygram, Neteller, SEPA, webmoney, cash by mail, or cash delivered in person.
You won’t be able to use credit card to the fact that you are selling and buying to/from other people. But should you not have a PayPal balance, PayPal has an option which lets you pay with your credit card.
Each payment method has different fees that have to be paid. Buying with PayPal on LocalBitcoins has less of a risk than if you were selling. And that is because Bitcoin is a currency in a digital form which is very hard to trace. And that is why many major credit card companies don’t allow credit card purchases made on Bitcoin exchanges and because they do not have such transactions insured.
A hard to reverse payment method (cash deposits, wire transfers) are advised if you are interested in buying Bitcoins.
LocalBitcoins uses a few methods to improve and maintain the security of the exchange system.
Traders have a reputation rank and a public history record that shows past activities.
Each time a trade is requested, the sent money is held by LocalBitcoins’ escrow service and only after the trade is confirmed by the seller are they released.
2FA or two factor authentication is an authentication option which asks the user for an additional PIN code which is received by the user’s mobile phone, each time the user wants to log in to their account. This option prevents the hacking of the user’s account. It’s not enabled by default.
If you log in from a different browser, an email verification will be issued by LocalBitcoins to verify if you are the same person.
Support and conflict resolution
The site’s support team is available to answer and solve any questions and misunderstandings that might occur between the sellers and buyers.
- There are no buying or selling limits, the limits are up to the trading parties to decide.
- No personal information is required from the user to be allowed to trade.
- The platform is available in most countries, even in those where there are no available cryptocurrency exchanges.
- Cash trades made in person are easy and fast to complete.
- You can check the other party’s feedback and trading history or their profile.
- LocalBitcoins itself has low fees, only 1% off all trades, but most of the sellers jack up the exchange rates.
- A forum is available for all LocalBitcoins users.
- You can buy Bitcoins with many payment methods.
- There are many scams, so you need to be cautious when there is any new user or transaction.
- Fees and rates can be costly when you buy Bitcoins in cash.
- Some payment methods have a reversible payment feature, which can put the seller at risk.
- The chosen payment method influences the speed of the transaction.
- Prices may be high depending on the payment method.
- Some sellers/buyers require ID identification before making a trade.
- It is risky to keep your Bitcoins in LocalBitcoins’ wallet.
- New users and those with bad feedback will have a hard time being accepted into a transactional deal.
All in all, LocalBitcoins is a good method to exchange Bitcoins, and it has many advantages for traders. If you are looking for speed of transactions, availability in a long list of countries and lots of payment options, then this platform would be a good choice.