What is LocalBitcoins And How Does it Work?

Jump to page contents

What is LocalBitcoins And How Does it Work?

LocalBitcoins is a cryptocurrency exchange with a difference. Based in Helsinki, Finland, the startup provides a platform for peer-to-peer Bitcoin trading. Registered users can use LocalBitcoins to advertise, buy, and sell Bitcoins, without having to use a conventional CEX exchange.

With LocalBitcoins, it is the individual sellers who set the conditions. For this, and several other reasons, the platform is often compared to Amazon or eBay. Sellers state the relevant exchange rates and the payment methods they accept, and buyers need to abide by these. The platform charges a fixed, 1% fee on successful transactions.

When a deal is agreed upon, the buyer and seller can choose to meet in person to trade the Bitcoin. Following the deal, both parties have the opportunity to review the other party, and this helps build credibility amongst users. Furthermore, LocalBitcoins offers an escrow service together with a conflict resolution team. As a result, this exchange counts over 110,000 active users worldwide, with around 2,500 Bitcoins traded daily.

How Does LocalBitcoins Work?

Although in the past using the platform could be done without user identification, the increase in users and trading volume has resulted in the need for better security. As a result, all active users today are duly registered and have undergone some form of KYC.

Registration

If you would like to open your LocalBitcoins account today, all you need is an identity document, such as a passport or national ID card. Register your email and follow the instructions to upload your document. Once your account is opened you can and should complete your profile. For safety and money laundering reasons, many users will not speak to you if your profile is not complete.

Search Trades

You can quickly start searching to buy or sell Bitcoin using the “Quick Buy” or “Quick Sell” tabs. You can use several filters, such as location or fiat currency, to narrow down the results. Another important filter is the payment method, since, depending on the seller, you could use LocalBitcoins to trade Bitcoins with PayPal, cash, or a variety of other methods.

Get to Know Your Buyer / Seller

At the edge of each offer, you will see a “Buy” or “Sell” button. Clicking on these will take you to the user information page. This is where you can evaluate the trustworthiness of the individual, and see stats such as the number of successful trades, overall feedback score, and status of profile verification.

Proceed with the Transaction

If you are satisfied with the conditions and the buyer or seller you should proceed with the transaction. In order to stay safe, you should always use the platform’s escrow service, which stores the Bitcoin until the funds reach the seller. Should the seller suddenly disappear, the team at LocalBitcoins resolution centre will be able to provide you with the coins.

Leave Feedback

Just like when you purchase an item from Amazon or eBay, you can and should leave feedback whenever you trade on LocalBitcoins. This helps keep the platform more secure and alerts other users to possible scams or other malicious activity. In more serious cases, you can also opt to block the other user without leaving feedback.

Recently Similar Guides

casinoin-promotion etoro-promotion

Latest Guides

AvaTrade,CFD Trading Platform,Trading

AvaTrade Fees Explained In Detail

AvaTrade is a fast-growing trading platform which offers an extensive range of Contracts for Difference (CFDs) in numerous markets. Founded in 2006, it is licenced and regulated across the world through its numerous subsidiaries and partners. For its services, AvaTrade charges fees, and this guide will help you understand what they are and when they […]

2 June, 2020
CFD Trading Platform,IQ Option,Trading

IQ Option Fees Explained in Detail

IQ Option is a leading Contracts for Difference (CFD) trading platform which is specially designed for the small investor. This award-winning platform offers a customisable user interface and a range of convenient services. Moreover, it provides clear and transparent fees, which are competitively priced and valued. General overview of IQ Option Considered to be one […]

29 May, 2020
CFD Trading Platform,Plus500,Trading

Plus500 Fees Explained in Detail

Plus500 is one of the world’s best-known trading platforms for Contracts for Difference (CFDs). These are financial instruments which let you invest in a variety of assets without needing to purchase and store them. As a result, CFDs are more convenient and faster to trade, allowing investors to short sell assets and trade using leverage. […]

26 May, 2020
Cryptocurrency,Forex,Margin Trading,Trading

Sortino Ratio

In the world of mathematics and statistics, when one individual develops a theorem or formula, over time, it is usually revised and/or used to derive other formulae and theories in the industry. In the case of the Sortino Ratio, it is an offshoot of what Professor William F. Sharpe came up with when he introduced […]

21 May, 2020
Cryptocurrency,Forex,Trading

What is MetaTrader 4?

If you’re going to cross a big river, you need a boat or a bridge. If you are going to trade Forex online, you need specialized trading software. Once installed on your computer, the software becomes a bridge connecting you to the Forex market. MetaTrader4 Defined MetaTrader4 or MT4 is a common trading platform that […]

18 May, 2020
Bitcoin,Blockchain,Crypto Wallets,Cryptocurrency

What is Bitcoin?

So, What Exactly is Bitcoin? Bitcoin breaks down into two distinct components, a blockchain protocol and a cryptocurrency, the first usable examples of both, designed to facilitate transactions in a peer-to-peer, decentralized manner. The cryptocurrency Bitcoin is a portion of code that represents an immutable digital token, similar to a digital gold coin that could be instantly broken down and […]

12 May, 2020
Cryptocurrency,Forex,Margin Trading,Trading

Sharpe Ratio

Over the years, several methods have been devised by statisticians, economists and mathematicians to measure the performance of tradable assets such as equities, commodities, stocks and currencies. One such measure is the Sharpe Ratio that was introduced in 1966 by William F. Sharpe: Professor Emeritus of Finance at Stanford. The ratio has since proven to […]

6 May, 2020
Crypto Wallets,Gambling,Litecoin

How to Get Started with Litecoin Gambling

What is Litecoin Gambling?  Without wanting to state the obvious, Litecoin gambling is pretty much what it says on the tin: gambling with Litecoin. Litecoin is a form of cryptocurrency developed in 2011 by Charlie Lee, a former Google employee (hey, that rhymes!); moreover, it’s a fork of Bitcoin, meaning that it branched out from […]

5 May, 2020