LocalBitcoins A Safe Crypto Exchange? Reddit & Quora Users Review the P2P Network

11 min read

This cyrpto exchange facilitates face-to-face and online transactions by matching Bitcoin buyers and sellers who reside close to one other. Registered users can reply to posted adverts and arrange to meet an individual buyer to purchase Bitcoins with cash or other forms of payment agreed to by the seller. Users can advertise their exchange rate and payment options for purchasing or selling Bitcoins. In addition, LocalBitcoins can be employed as an escrow service, which ensures the fairness of every transaction conducted by the user.

You may sign up for LocalBitcions here.

Active Reddit and Qoura Community

For more information from users with experience using LocalBitcoins it is a good idea to search for posts or discussions on Reddit and Quora. Both platforms have active cyrpto usere communities and there is a good deal of posts on LocalBitcoin. Several of the posts to review on Reddit would include; “How safe is localbitcoin“,”A warning reminderto those selling Bitcoins on localbitcoins“,”LocalBitcoins.com – global p2p bitcoin marketplace“, and “Trying to use localbitcoins.com but I need to ask a few question to the ones who have it“. Another great place to review LocalBitcoins is on Quora. Here are a few of the better Quora discussions; “How does LocalCryptos compare to LocalBitcoins as a P2P exchange?“, “Which is a better P2P overall, Paxful or LocalBitcoins, and why?“, “Is the LocalBitcoins website genuine?”, and “How do I use LocalBitcoins?“.

How Does LocalBitcoins Work?

As far as P2P networks go, LocalBitcoins is a different exchange model than what the Exchange Brokers (such as Coinbase, Robinhood, WeBull, TradeStation and Binance.US) and traditional exchanges provide using a different model (Bittrex, Binance, Kucoin, Kraken, LCX, etc.). Essentially, a P2P network is a form of Bitcoin exchange where users deal directly with each other and not the exchange. This creates a really decentralized process, if there ever was one. If you’re using a broker or exchange, the price of crypto is established by a market rate, and it’s purchased or sold at a as a result of the exchange transactional process. However, LocalBitcoins sellers can define their own price range and requirements, where buyers decide if they want to make a transaction with the seller. To finalize the trade, you can either meet in person or use an online payment alternative.

As a classified ads website it’s often referred to as the “Craigslist of Bitcoin” because it is a very similar marketplace. As a result, consumers respond to adverts created by users behind usernames (typically neither LocalBitcoins nor the payment processors are engaged in any of the terms of the transactions), the exchange merely functions as an escrow agent (remember this is vital to your safety). As a seller, you have the option to select your payment method and verification requirements. The number of confirmed trades and feedback score are displayed next to each username. LocalBitcoins is the most popular P2P network. Brokers (such as Coinbase, Robinhood, WeBull, TradeStation and Binance.US) and traditional exchanges (Bittrex, Binance, Kucoin, Kraken, LCX, etc.) use a different model.

Remember, as a classified ads website it operates in a very similar process to Craigslist. Because, you as the buyer, responds directly to the advert created by the seller. Neither LocalBitcoins nor the payment processors are vetting you or the seller. LocalBitcoins only functions as the escrow agent in each transaction. As a seller, you have the option to select your payment methods and verification requirements. To help both parties get a better understanding of the other party, LocalBitcoins  displays the number of confirmed trades and feedback score next to each username. There’s no mistaking payment, pricing, or limits.

As you move your cursor over the arrows, you may see confirmed trades. When it comes to purchasing and selling, it’s rather easy if both parties agree, the escrow service keeps the seller’s BTC until the transaction is completed. The merchant distributes the coins to your wallet once you’ve paid. There are times when support makes a decision in order to resolve a conflict.

You may sign up for LocalBitcions here.

Is LocalBitcoins Safe?

My inquiry led me to a number of forums where people asked if LocalBitcoins was a fraud. While it’s true that trading on the black market is more risky than using a broker, users can trade with confidence thanks to a variety of security features. Use the escrow service and be clever about your trades to avoid problems. Other payment methods are used successfully every day on LBC, resulting in hundreds of successful trades. A few of them carry a higher level of risk because the user is responsible for much of their own security. Fortunately, LocalBitcoins is there to help. Listed below are some of the reasons why LocalBitcoin is secure?

Verification:

The anonymous nature of Bitcoin is respected by LocalBitcoins, which is why it does not demand a government-issued ID or any personal information. Signup simply requires an email address. As long as no personal information is required by either the buyer or the seller, the transaction can be completed without knowing the personal identity of either individual.  However, in some transactions, a seller or purchaser may ask for identification before proceeding. Those who wish to trade in fiat currencies can do so as long as someone is prepared to take their local fiat currency in exchange for Bitcoins. In order to trade Bitcoins, the exchange only accepts fiat. Alternative cryptocurrencies are not supported.

LocalBitcoins Trading Analysis:

LocalBitcoins emulates a peer-to-peer network, but does not provide brokerage services. Rather LocalBitcoins connects local sellers with local buyers. Advertisers on the platform post information about exchange rates and accepted payment methods for buying or selling bitcoins. As a result, people respond to these ads and set up a meeting with the trader in order to complete a transaction. For members to identify legitimate traders from scammers, LocalBitcoins also offers a reputation system and feedback mechanism. Remember, just as when you use CraigsList, you are responsible for the safety of the local meeting.

A dispute-resolution tool and an escrow service, both offered by the trading site, assist customers in resolving disputes. You should be cautious when trading on LocalBitcoins because there is a greater possibility you can get scammed. Deals are negotiated between persons, after all, and you should be aware of a few more items when trading on LocalBitcoins.

Transaction Fees:

LocalBitcoins strives to keep things simple and leaves everything to the consumers. It’s the same with their transaction costs. A simple 1 percent fee is imposed to all trades and the seller pays the fee. This implies that LocalBitcoins will be free to use if you’re solely looking to buy Bitcoins. Keep in mind that standard Bitcoin network fees apply for all transactions.

The vendors actually don’t have a transaction charge. Instead, they charge higher exchange rates, so when making a trade, take the higher trade rate into account. They do not charge any fees on buying/selling Bitcoins, but they do charge a flat 1 percent fees on completed deals, which basically indicates they do charge to buy or sell bitcoin but have worded it differently. For those who want to purchase Bitcoins using cash, you have to use an invoice system which adds an additional 0.5 percent onto the fee. This is the same when any invoice is used. For cheaper trades, seek to avoid the payment methods that require an invoice. There are dozens of payment methods you can buy bitcoin with nowadays: bank transfers, credit/debit cards, mobile wallets like Neteller, PayPal, plus many more.

All these diverse approaches result in the same thing: money entering and departing your bank account, which ultimately means you still need to answer to the taxman. As plenty of nations are now defining cryptocurrency as a tangible item, these are areas where you must pay capital gains tax on your sales. We are not in any way supporting avoiding a tax, but you can buy bitcoin through LocalBitcoins using cash, which does not go into your bank.

Remember, through LocalBitcoins you can purchase bitcoins using a credit card or any other payment method. They adopt this technique because it is determined by the vendor, who specifies how they want the customer to pay. The buyer can then decide whether or not they want to complete the transaction based on the payment method. A lot of customers say they’ve found great prices on this website, but some say they’ve paid way too much for bitcoin. A buyer and a vendor are matched by LocalBitcoins, and the buyer and seller can then select how to proceed with the transaction. In order to exchange money, they can meet in person, or they can agree on a bank transfer LocalBitcoins ensures security by requiring the seller to place the agreed amount of bitcoin into escrow. A buyer’s chosen wallet is used to receive the coins once payment is received. Next, we’ll take a closer look at how this platform works, and see if it’s a practical way to acquire bitcoin.

User Experience:

There is a nice platform called LocalBitcoins that many consumers get conned on because of the peer-to-peer contact. Online, you’ll find a plethora of stories of scams or problems users have had when using LocalBitcoins. As a result, LocalBitcoins’ reputation suffered. You can still buy and sell Bitcoins on an exchange. Peer-to-peer trading, on the other hand, is the obligation of the user to be safe and educate themselves about the potential dangers. Scam alerts can be posted on LocalBitcoins as well. Users can share their experiences with other traders in this portion of the website.

Security Features:

For example, in this LocalBitcoins Review, you’ll learn that the exchange platform provides security features such as two-factor authentication, HTTPS online encryption, SMS and email notifications and Login Guard, PGP encryption for email communication, and escrow. It is the escrow that keeps the buyer’s payment until the seller acknowledges that the trade was successful. Hackers gained access to the trading platform’s live Chat account in 2015 and stole about 17 BTC from user wallets. LocalBitcoins was hacked in 2021, but no user data was compromised, according to the company. During a five-hour security breach in January 2022, hackers gained access to six user accounts and stole more than BTC 7.9 million. 

LocalBitcoins Privacy:

Here’s where LocalBitcoins really excels. Unlike other cryptocurrency exchanges, like Coinbase, that have taken a traditional banking approach to doing business, LBC allows you to purchase and trade cryptocurrencies without having to give up vital information. Sure, customers utilizing high-risk payments methods like PayPal are sometimes forced to verify their identity, but it’s an essential step that needs to be taken to protect vendors.

If you’re trying to convert Bitcoins into conventional currency, there is no necessity for you to supply any personal information. That’s something merchants who cherish their anonymity enjoy. If you want to purchase Bitcoins without leaving a paper trace, all you have to do is use one of the safer payments methods like cash in person or cash deposits. Generally speaking, the more irreversible the method you choose to purchase Bitcoins, the better the pricing you will receive. The markups will be naturally lower since there is less risk.

Well-designed platform:

LocalBitcoins is a secure platform that makes it easy for buyers and sellers to arrive at educated decisions about who to do business with by providing a convenient reputation system. Users can submit comments on the people with whom they are trading. Each user’s prior activities are detailed in a public history record that may be accessed If you’re buying or selling. You should only deal with dealers who are well-respected and who accept the payment method you want to use. On LocalBitcoins, when a deal is initiated, the seller’s Bitcoins are automatically removed and placed in escrow. Sellers distribute coins when they’ve been paid. This protects both the seller and the buyer. Before releasing coins, the seller has a chance to confirm receipt of the money. If you’re a buyer, it assures that the seller can’t simply disappear with your money without releasing the Bitcoins you purchased when two parties disagree, LBC will act as a moderator and investigate the transaction before deciding whether to release the coins.

For enhanced security, LBC offers multi-factor authentication to its consumers. In other words, it will be necessary for you to input a pin code to log in and transfer Bitcoins. This makes it far more difficult for hackers to steal your cryptos if they have your personal information. To protect your privacy, LocalBitcoins employs login-guard to authenticate your browser each time you visit their site. Security systems demand email verification whenever a new computer is being used to log in. Support personnel are available 24/7 to help address any concerns between buyers and sellers in a timely manner. On the site, there is also a large forum where users may discuss advice or report suspicious users.

The LBC scammer problem:

When it comes to LocalBitcoins, the majority of users have nothing but good things to say about LocalBitcoins. LocalBitcoins is recommended if you already have a basic understanding of the cryptocurrency world and want to buy and sell Bitcoins. An added bonus is you don’t have to divulge very much personal information. However, remember you’re more vulnerable to being scammed on LBC since you’re buying and selling with individuals rather than a firm like Coinbase, where you purchase from and sell to the company.

Due to the fact that LBC lets nearly anyone trade on their site with minimal verification, there will always be some dodgy characters looking for people to take advantage of in a sale. Consider the reputation and public history of the persons with whom you do business. It’s better to conduct business with a trader who has been on LocalBitcoins for five years and has thousands of deals and very few complaints against him/her than with someone who just started an account a few hours ago and has no feedback on their performance.

Why should you consider using this platform?

Due to the fact that it is more than just a trading platform, this exchange is a bit different from others. Coinbase, Kraken, Bit stamp, Bittrex and others dominate the crypto-market today. To sign up for one of these exchanges, you’ll need to provide your social network usernames. So long as you don’t furnish them with all of this information, you’re out of luck. LocalBitcoins, on the other hand, has a distinct set of rules A minimum transaction charge is used to finance your transaction and you are not required to link your bank account right away. You’ll need to open an account with a proprietary digital wallet in order to acquire Bitcoins using this exchange.

As soon as that’s done, you’ll want to look for Bitcoin buyers and start selling or buying your bitcoin. Obviously you want to sell your cyrpto when the price is high or if you’re looking to hold digital currencies with a long-term investment plan, you’ll want to buy from individual sellers, as opposed o a broker. Anytime an offer meets your criteria and is within your price range, you should contact the seller to discuss the deal. As soon as a deal has been completed, you’ll need to find a payment method. Cash deposits via PayPal or a bank are generally preferred for online trades. It’s also possible to meet your vendor face-to-face, taking advantage of LocalBitcoins’ capabilities.

Is there a way to avoid scams on LocalBitcoins?

Your transaction details are kept secret and encrypted because this is a peer-to-peer exchange mechanism. So that you can simply prove that payment has already been made and Bitcoins are ready to be delivered, this exchange puts the Bitcoins in escrow when the payment is made online. You can avoid having to file a complaint by taking some care when picking the traders you do business with on every transaction. Consider clicking on the username of the trader when considering a transaction so you may research deeper into the trader’s personal details as well as his trading history before committing to a trade.

How to Use LocalBitcoins

It will be possible to look for sellers in your region from within the site. In addition, you’ll be able to select your preferred payment option. If you live in a large city, you’ll have more possibilities on sites like these (including Craigslist). As an Eastern or Southern hemisphere resident, you may live in a huge metropolis where Bitcoin/cryptocurrency culture isn’t very prevalent. Be on the lookout for reliable vendors. It is possible to determine this by reading user reviews and looking at vendor ratings. Ideally, good vendors will have dozens or hundreds of positive feedback reviews under their belt. If you have a larger pool of users to choose from, your options and costs will improve.

Pricing, payment alternatives, and meeting location are just a few of the options you’ll be able to set up for your transaction. LocalBitcoins’ security protections will not be available if you communicate outside of LBC, and you should not disclose the seller personal information unless you are highly experienced and have a solid reason to disclose that information. Despite the name, not all transactions on LocalBitcoins are local. All of the rest should be simple if you’re completing your transaction through the platform, If you’ve chosen a payment method besides cash. Until your Bitcoin arrives, your money will be held in escrow at LocalBitcoins until you can complete the transaction.

You may sign up for LocalBitcions here.

LocalBitcoin Affiliate Program:

If you’re a LocalBitcoin affiliate, you can link to any page on LocalBitcoins.com, whether it’s a nation or payment method listing. When users arrive at the site via your affiliate link, you will earn bitcoins. Registration and trading are steps two and three in the process Three months after a visitor visits your site; you will start to receive in your LocalBitcoins wallet of affiliate partners a daily bitcoin payouts.

For a period of one year following the user’s registration, commissions will LocalBitcoins.com receives a commission based on the new user’s revenue (trading fees). A LocalBitcoins.com affiliate may be removed at any moment. Your affiliate program will be cancelled if you violate the terms. Earn 20 percent on every successful trade as a LocalBitcoins affiliate partner. Example: If two individuals register on LocalBitcoins.com as buyers and sellers of bitcoins and they make a 100 BTC trade, you get a 20 percent commission on the LocalBitcoins.com trading fees from both participants, for a total commission of 40 percent. There is 0.4 BTC added in your account.

Final Thoughts:

To buy Bitcoins using a person-to-person domain and to buy Bitcoins in cash, you can only use LocalBitcoins. This makes them a good option for customers who want to trade in cash rather than using a credit payment. It’s doubtful, however, that this will become a popular method of purchasing cryptocurrencies, given cash is on its way out. It won’t die, but due to the fact the entire network is controlled by people, there is always the danger that one person will not honor his end of the arrangement and the user will have to deal with the consequences.

Even though Bitcoin’s lack of regulation and centralization would appear to be a plus, it creates a lot of red flags for an exchange, as certain people cannot be trusted. Trades might be watched and rigorously managed by the website, but despite strong security features and sophisticated ways of protection, there are still numerous scams and frauds. If you have any questions about LocalBitcoins, we hope this review has answered them.

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