LocalBitcoins Review 2020 | Payment methods, Features | How to avoid getting scammed – MindYourCrypto

Local Bitcoins

In plain words, LocalBitcoins is one of the largest peer-to-peer (P2P) Bitcoin exchanges that enable users to communicate directly and buy/sell Bitcoins locally. This detailed LocalBitcoins review will help you to acquaint with the proper functioning, features, pros, and cons of this global p2p platform.

Whether you are looking for an alternative for buying Bitcoin with fiat money or you are a user from a country where banking support is not available for Bitcoin exchanges, here comes the need for the exchanges like LocalBitcoins. In both cases, LocalBitcoins can be your best bet for buying Bitcoin using fiat money but you need to make your move cautiously. But why, let’s discover more in detail.

Content details

1. What is LocalBitcoins and how it is different from others?

2. Is LocalBitcoins safe to use?

3. How to start using LocalBitcoins?

4. How to find traders in the market place?

5. Dos and Don’ts, while choosing a seller

6. Supported payment methods and currencies

7. Supported countries

8. LocalBitcoins fees

9. Customer support

10. LocalBitcoins Pros and Cons

11. Final words

1. What is LocalBitcoins and how it is different from others?

source : localbitcoins.com

LocalBitcoins is a Finland based P2P Bitcoin exchange that enables users all over the world to buy/sell Bitcoins locally and by using fiat money. It was founded in 2012 and since then it has grown exponentially to become one of the largest peer-to-peer marketplaces which is available in 200+ countries and 16000+ cities across the world.

It provides a great fiat to crypto ramp-up in countries with lesser banking support to crypto exchanges or the countries where crypto exchanges lack fiat buying options. Thus enabling the unprivileged to buy and sell Bitcoins with ease and security from anywhere in the world.

How LocalBitcoins is different from other exchanges?

On the basis of authority, scalability functionality, the crypto exchanges are basically divided into five categories i.e Centralized (CEX), Decentralized (DEX), Hybrid (features of CEX+DEX) Instant, and Broker exchange.

Among these LocalBitcoins positions itself as a decentralized exchange. It is very similar to P2P services like eBay and Craiglist. LocalBitcoins allow users to post their adverts to buy/sell Bitcoins and receive requests of those interested and let them confirm all the details before making the deal.

To know more about crytocurrency exchanges, please check outTypes of Crypto Exchanges“.

The features that differentiate it from regular crypto exchanges are;

Peer-to-Peer: LocalBitcoins is a P2P exchange that allows users to interact and trade directly with a person of their choice. There’s not an auto trading mechanism to carry out trades, but it’s the people who facilitate the trading process among themselves.

Escrow: LocalBitcoins, being a P2P platform employs an escrow facility to safeguard the seller against fraud and to make the whole process safe and efficient. When a seller places an advert, he/she has to send the selling amount to escrow. LocalBitcoins locks the Bitcoins of the seller in an escrow and releases the amount to the buyer only after confirmation from the seller’s side.

Facilitate Fiat Buy/Sell: Most of the known exchanges like Coinbase, Kraken, Binance, Bittrex supports only a limited number of fiat currencies for buying BTC or other cryptocurrencies. It holds users to use these platforms, even they are available to their countries. However, LocalBitcoins offers a lot of fiat buying options to users in a particular locality.

2. Is LocalBitcoins safe to use?

LocalBitcoins is one of the earliest peers to peer exchanges and over time it has also evolved as the largest one.

Is the platform safe to use or not?“, is the first thought that always comes to the mind of a new user about a particular trading platform.

As of my personal experience, LocalBitcoins is quite a safe and genuine platform to use. It’s a P2P exchange and you’re dealing with strangers every time you make a trade and thus it’s advised to be cautious when trading on this platform. Although you may found a mix of opinions and ratings on various exchange rating platforms. Most of the negative user remarks are a result of trading with a new user (have no history of making trades) or a user with a lower rank with bad feedbacks.

Thus, to some extent it’s your responsibility too, to choose a genuine buyer or seller by checking the feedback score and detailed feedback profile of the concerned buyer or seller. Always, “think twice before you act.”

Safety measures to consider, while using LocalBitcoins.

LocalBitcoins utilizes various security measures to ramp-up the security on the platform. Some of these are :

1). Wallet safety: LocalBitcoins clearly states that it stores only a small amount of Bitcoins in hot wallets.

2). 2FA and Login guard: It allows users to enable 2FA or two-factor authentication which is an added layer of security. Its login guard scans your browser every time you log in to your account. If login takes place from a different browser, it will immediately ask for email verification.

3. Escrow and Conflict resolution: When you place a sell advert, LocalBitcoins locks the requested Bitcoins in escrow. It will release the amount only if you confirm to do so.

However, if a conflict arises from either side, the conflict resolution team will be there to take the charge and help both sides to sort out the matter. Escrow will be released only after resolving the issue.

4. User Feedback and Reputation: LocalBitcoins follows a unique approach to strengthen the overall safety and security of the P2P ecosystem. It encourages all its members to give feedback about opponent buyers or sellers, after a successful trade. LocalBitcoins use this feedback to rank or rate the traders and these ratings or feedback score determines which user will be listed on top or at the bottom.

             Hence, as a user, it is your responsibility to always give your feedback after each trade and help the community in making LocalBitcoins a safe and secure platform.

Hack update

Despite all safety measures LocalBitcoins was hacked in 2015 and 2019 and lost nearly 25 BTC in both attempts combined. Hence it’s advised, that you should always store your Bitcoins in a cold wallet instead of keeping them on an exchange wallet.

3. How to start using LocalBitcoins?

LocalBitcoins has a simple and easy to use website interface. Most of the required information is available on the homepage and you don’t need to navigate to search it.

Signup & Login

source : localbitcoins.com

Getting started with LocalBitcoins is quite simple. In order to start with LocalBitcoins, you have to register an account. Just enter your email, set a strong password, mention if it’s a company, and click register. You will get a confirmation email, click the given link in the email and verify your account. Now you can log in to your account by entering the login details.

KYC Needed

After getting logged in to your account, you can begin to search for Bitcoins buyers/sellers in a locality of your choice. But before starting with your trades, you have to complete the KYC by uploading the required identification documents like driving license, Passport, or other government-approved ID. For completing your KYC verification, please follow the below-given steps.

source : localbitcoins.com

LocalBitcoins allowed users to trade anonymously from the beginning of its services and doesn’t require KYC data. But after mid-2018, it has to comply with certain regulations and changed terms of service and made KYC mandatory for all users.

4. How to find traders in the marketplace?

LocalBitcoins is a peer to peer exchange where people from all over the world can exchange their local currencies to Bitcoins. It provides an easy to operate interface and enable users to make a variety of choice in terms of location, local currency, and payment methods.

Now you have an active verified account ready to make trades. Yet searching for traders is never a big deal, but selecting the right trader can be. LocalBitcoins enables you to search and select a trader that meets your expectations.

Let me show you how it works ;

1). Login to your LocalBitcoins account and visit the homepage. Let’s assume that you want to buy some Bitcoins.

source : localbitcoins.com

2). Click on “Quick Buy” and enter the amount of Bitcoins that you want to purchase.

3). In the next step, you have to filter out your native currency, country, and payment option of your choice.

4). Click on the “Search” tab and below you will get a list of sellers along with their feedback score, the number of successful trades, and respective payment methods.

source : localbitcoins.com

5). Click on a “Seller’s username”, of your choice and you can access detailed information of that account including trade volume, trades with different partners, email, phone, ID verification details, and trust score.

6). Beside these details you can also ask for any additional information from the seller.

             Similarly you can apply the same filters on sell side too.

5. Dos and Don’ts, while selecting a seller

LocalBitcoins has a fair user feedback mechanism that improves the reputation of genuine users and helps its members to distinguish between genuine and fraud users. As a buyer on LocalBitcoins, before concluding a trade you need to assess and verify certain details of the respective seller to avoid getting scammed. Below is a list of dos and don’ts that will help you to avoid bad sellers(scammers) and close the deal safely.

‌Dos

1). Always look for a seller who has a feedback score of 98% or above.

2). Checkout the detailed profile and verify that the seller’s account must be older than a year.

3). Has traded more than 50 BTC and completed successfully more than 100 trades.

4). Check whether the shortlisted seller has a verified email, phone number.

5). Seller must be trusted by 20 or more people.

6). Always communicate to seller via LocalBitcoins message box.

7). Concise all your requirements and discuss them with the seller in advance. If everything is fine, you can start the trade.

‌Don’ts

1). Never choose a seller merely on the basis of low selling price.

2). Always stick to the platform and never make trades with vendors externally.

3). Never disclose more information than required.

4). Avoid sending payment info via third party apps.

          As a buyer if you stick to the given rules, you will be more than able finish your trade easily and safely.

Seller’s safety

However, the above-stated safety measures are mostly buyer-centric. You need to be careful as a seller too because a buyer can be a scammer.

In addition to the given measures, as a seller, you are advised that you should never confirm the release of Bitcoins from exchange escrow before receiving funds in your bank account or any other account. Double-check your account and then confirm the release of Bitcoins.

6. Supported payment methods and currencies.

LocalBitcoins is a global P2P exchange that allows its members to buy Bitcoins in their native fiat currencies. It supports most of the fiat currencies via different payment methods. Users can easily access and select a payment method from the “All Online Payment” section on the homepage.

Some widely used payment methods are :

International Wire (SWIFT)

MoneyGram

National Bank Transfers

Moneybookers/ Skrill

Google Pay

Neteller

Online Wallets

Payeer

PayPal

Worldremit

Western Union and more

Payment in altcoins :

Ripple (XRP)

Litecoin (LTC)

Ethereum (ETH)

7. Supported countries

LocalBitcoins is available all around the world except Iran, Germany and States of New York (USA).

8. LocalBitcoins fees

Registering an account with LocalBitcoins is completely free. Users who create advertisements are charged with a 1% fee for every completed trade. Usually, it’s the maker who has to pay fees.

Transactions from one LocalBitcoins account to other accounts are free. However, a network transaction fee is applicable for all transactions to other Bitcoin wallets which depends upon network congestion.

9. Customer support

LocalBitcoins customer support is quite supportive and can be reached via email only. Because of its large user base, the support team is usually slow to respond. Most of the time support team reply within 3 days, but sometimes it takes up to 5 days which is a quite delayed response.

               It also offers forums where you can request help from other users.

10. LocalBitcoins Pros and Cons

Pros are;

1). Lot of fiat currencies are supported.

2). A variety of payment methods to choose from.

3). Fast transactions.

4). Reasonable fees.

Cons are;

1). Exchange rates are quite high.

2). Complicated for beginners.

3). Possibility of scams.

11. Final words

LocalBitcoins is one of the oldest and well-established peer-to-peer Bitcoin trading platforms that facilitates the buying and selling of Bitcoins with fiat money. It supports a variety of payment methods and enables a user to buy Bitcoins without boundation or limits. Limits can be subjected to levels of user verification.

        Apart from that, every user has a unique set of needs and priorities that determines their choice while choosing a trading platform. Similarly, each crypto exchange operates differently having some advantages and disadvantages. I’m sure, that after reading this detailed LocalBitcoins review, you have got enough idea about the features and background of LocalBitcoins that will certainly help you to make your decision wisely.

It’s always worthy to educate yourself about a particular product or service before starting with it.

At MindYourCrypto, in our exchange review series, we have also reviewed some other great digital currency exchanges that are worth checking out.

Coinbase Review

Binance exchange review

WazirX review

Kraken detailed analysis

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