Should I be Using Localbitcoins in 2022? A Detailed Review

Unlike other exchanges, LocalBitcoins lets users to contact directly with one another. LocalBitcoins is similar to Craigslist in terms of buying and selling Bitcoin. Its sellers provide a wide range of payment alternatives, and the built-in escrow ensures buyer protection. 

LocalBitcoins is a genuinely worldwide network, despite the fact that it is targeted on assisting bitcoin dealers in their local area. Essentially, Bitcoin merchants create a platform advertisement in which they declare their terms and establish their own fee. Buyers can utilize a variety of payment options online with escrow protection, or they can arrange for in-person meetups to purchase Bitcoin with cash in hand.

Its services are available in the majority of countries around the world, including the United States, Venezuela, Zimbabwe, Nigeria, China, India, Kenya, Iran, Qatar, Lebanon, Israel, Pakistan, the Netherlands, Russia, South Korea, Philippines, Malaysia, Argentina, Romania, Uganda, Turkey, Kazakhstan, Thailand, Spain, Ireland, Brazil, and the United Kingdom (UK), among many others. 

Furthermore, the platform is ideal for connecting peer-to-peer buyers and sellers in densely populated cities such as Tokyo, London, New York, San Francisco, San Diego, Toronto, Montreal, and many others. LocalBitcoins serves Bitcoin merchants in 248 countries and 7938 cities as of February 2021. 

What Sets Local Bitcoin Exchanges Apart from Other Exchanges 

Local Bitcoins differs from other exchanges in that it is not a trading platform. When you open an account with a large exchange, such as Coinbase, Kraken, or Bitstamp, you link your bank account directly to their trading interface to finance your buy and sell orders. These exchanges charge transaction fees in exchange for facilitating your trades. 

Local Bitcoins are distinct. Assume you wish to purchase some Bitcoins from Local Bitcoins. You first register an account and a wallet on Local Bitcoins, but you do not immediately connect your bank account details to Local Bitcoins. Instead, you look for other individuals who have Bitcoins to sell to you. When you identify a person offering to sell Bitcoins at a good exchange rate and terms, you message them to work out the details. Then you discover a way to pay the person. 

When you open an account with a large exchange, such as Coinbase, Kraken, or Bitstamp, you link your bank account directly to their trading interface to finance your buy and sell orders. These exchanges charge transaction fees in exchange for facilitating your trades. 

You can utilize a cash deposit through a bank, PayPal (fees apply), or another method of cash transfer for online trading. In certain circumstances, you may meet up in person and exchange cash for Bitcoin, hence the moniker Local Bitcoins. After you pay, the Bitcoins are transferred to your Local Bitcoins wallet, from which you may transfer them to your own wallet. 

LocalBitcoins had 913,000 active dealers and 1.46 million new registered users in 2019. LocalBitcoins has over 8 million consumers from over 190 countries worldwide. It is one of the most popular Bitcoin trading platforms. LocalBitcoins provides buyers and sellers with direct trade, communication, dispute resolution, and escrow services. The escrow services take the seller’s money from their wallet and release them if both parties agree the exchange. 

The Benefits and Drawbacks of Using LocalBitcoins 

Pros 

  • When done online, trades are safeguarded by escrow. 
  • Sellers might benefit by selling Bitcoin at a price higher than the market. 
  • There are several payment options available. 
  • Sellers have control over the quantity offered, the payment method, and the categories of purchasers to whom they sell. 
  • Buyers can buy up to 1,000 euros of Bitcoin per year on the platform without ID verification, while sellers on the site can react to buyers for purchases of Bitcoin in excess of 1,000 euros per year outside the platform.

 Localbitcoin is a platform that connects users with others to purchase and sell bitcoins from anywhere in the globe in a secure environment. You may post a buy or sell announcement on the platform, mentioning the precise amount and the method of payment you accept, or you can locate an advertisement that meets your demands, so you will always have possibilities to swap. 

When you initiate an exchange, the platform freezes the amount at stake, so the seller cannot escape with your bitcoins after you pay, and this will only be released if the payment is validated, so both sides are certain that they will not be victims of fraud for the other. You can also verify all of the information of the person with whom you are negotiating, including the number of trades completed on the platform, reputation, whether their account is verified with an ID card, and average payment and release times, which is very useful for avoiding exchanging with people who take their time to pay or release, which is very annoying when you’re in a hurry. 

Cons 

  • Only Bitcoin may be purchased. 
  • For first-time users, the process of creating an ad is extremely hard, and there is a learning curve to efficiently promote your Bitcoin. 
  • Sellers may be reported by individuals with malicious intent and have their accounts and wallets frozen, resulting in no access to their Bitcoin until their accounts and wallets are unfrozen.

The platform’s disadvantage is the design of the website; it is not very intuitive and is somewhat archaic, so the learning curve for an inexperienced user may be fairly sluggish and long, and without the assistance of someone knowledgeable, people may be afraid and appear a little enthusiastic to use it. 

How does LocalBitcoins function? 

LocalBitcoins is essentially a marketplace where people may make offers to purchase or sell bitcoin. As a user, you make a post in which you indicate the exchange rate, location, and desired payment method for a transaction. You may also promote your article as an advertisement, increasing its visibility (this is how LocalBitcoin makes money). If someone responds to your message, you can both agree to make a deal using a bank transaction, a payment service, or any other accessible means. 

LocalBitcoins, unlike centralized exchanges like Coinbase, let you to trade directly with other users. Nonetheless, the network is not totally decentralized, since it registers and monitors all of your LocalBitcoins transactions. When you begin a deal, the traded bitcoins are stored in the escrow facility of LocalBitcoins. The exchange is only accomplished when the seller confirms the transaction. 

The LocalBitcoins platform’s native reputation system is another critical feature. Chargeback fraud is frequent in ecommerce, and despite the fact that bitcoin transactions are irreversible, standard payment suppliers continue to accept them. As a result, some users may be duped into selling their bitcoins, resulting in the loss of their hard-earned money. The LocalBitcoins reputation management system lets users to post feedback for buyers and sellers, which may assist you in determining whether the buyer or seller is legitimate. 

As a general rule, it is safer to deal with older accounts that have received positive reviews rather than making a transaction with new and suspicious ones. Do not pick deals simply on price – any offer with an unusually low price should be regarded with caution unless the dealer has been completely vetted and has earned a large amount of good feedback. 

LocalBitcoins Fees, Limits, and Payment Options 

What Are the Fees, Limits, and Speeds for Deposits and Withdrawals?

LocalBitcoins is not a party to peer-to-peer transactions and does not manage payment. They only allow Bitcoin advertising and transfers between LocalBitcoins wallets. They do, however, allow sellers to select from a variety of payment choices. 

Because all transactions are recorded on the Bitcoin Blockchain, transaction times are normally between 30 minutes and an hour, however this can vary based on the number of transactions being recorded at the time of the transaction. This is much longer than a centralized exchange, which allows customers to purchase and sell on the platform quickly. The pace of transferring Bitcoin from centralized exchanges to a wallet is comparable. 

Methods of Deposit

LocalBitcoins differs from typical cryptocurrency exchanges in that sellers place the Bitcoin in escrow. Buyers make direct payments to vendors, who then mark the transaction as complete on the site. Sellers must choose whether or not to release them after money is received. 

Because LocalBitcoins does not handle payment, merely the transfer of Bitcoin between LocalBitcoin wallets, the cost of transferring money to a seller is determined by your payment processor costs. 

Before they can begin promoting and selling on the site, LocalBitcoins vendors must deposit at least 0.4 Bitcoin into the LocalBitcoins wallet. 

Methods of Withdrawal 

Because payment is handled directly between buyer and seller, there is no withdrawal of fiat payment from the LocalBitcoins network. Transfers from a LocalBitcoins wallet to another kind are the sole withdrawals from LocalBitcoins.

Trade Sizes and Limits for LocalBitcoins 

Sellers establish order restrictions when they create an ad. These prices range from $5 to $5,000 USD per purchase (may vary if using a different denomination of fiat or cryptocurrency). This is significantly smaller than the order limitations on worldwide centralized exchanges, which may range up to $100,000 USD per day depending on the platform. 

There are no yearly limitations on the quantity of Bitcoin that may be purchased or sold. However, for transactions above 1,000 euros per year on the LocalBitcoins site, you must authenticate your identity. You must additionally authenticate your domicile for transactions above 20,000 euros per year, and you must undertake further verification for transactions exceeding 200,000 euros per year.

Last Thoughts 

LocalBitcoins offers a one-of-a-kind solution for a specific market. The majority of transactions are for remittances to nations sanctioned by the US. 

The majority of retail cryptocurrency investors should utilize a worldwide exchange like as Coinbase or Binance. Because LocalBitcoins exclusively handles Blockchain transactions, the purchases take time to complete. In contrast to Binance, where a buyer’s crypto balance is immediately reflected in his or her account, this is not the case. The fees for purchasing Bitcoin are significantly higher than on worldwide exchanges. Dealing with a person on a personal level may be daunting, especially for first-time purchasers. Before signing up for any exchange or broker site, make sure you do your homework. Crypto, including Bitcoin, is volatile, and you should never buy more than you can afford to lose. 

Should you use LocalBitcoins?

It all relies on your own scenario, as it always does. LocalBitcoins is a fantastic method for individuals all around the world to exchange bitcoins, particularly in areas where there are few or no other choices. It rose to prominence as a go-to destination for the world’s unbanked, but that is no longer the case. Despite this, it continues to provide the most payment alternatives in the globe and is a genuinely global bitcoin exchange.

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