I understand how difficult it can be for some of you to buy Bitcoins if you don’t live in developed nations. There is a frequent suspension of services by prominent exchanges of the world when the demand surges for Bitcoin.
That’s why it makes sense talking about an alternative service through which one can buy Bitcoins peer-to-peer anytime.
The name of this service is LocalBitcoins (aka LBC).
What Is LocalBitcoins
LocalBitcoin is a peer-to-peer Bitcoin exchange that keeps bitcoins in its escrow. It has been operating from Finland since 2010.
It has on-ground buyers and sellers in more than 15,000 cities across 248 countries that’s why chances are, you will find a buyer/seller in your country via LocalBitcoins even if you live in a third world country.
The best thing about LocalBitcoins is that you deal with the buyers/sellers directly and decide to trade only if you are satisfied with the terms of the trade. Once you engage in a trade you can receive your fiat money in the agreed way through a bank deposit, PayPal, Payoneer, or in cash. And when it comes to receiving your bitcoins LocalBitcoins act as an escrow in between so that you don’t get cheated.
Starting Off With LocalBitcoins
Signing up and logging in to LocalBitcoins is very easy. You just need to register yourself using your e-mail ID and get started.
After you register and log in to LocalBitcoins, it is always a good practice to complete your profile (except if you wish to be anonymous). Completion of the profile is needed by some traders as a condition, so if you don’t do this you will not be able to trade with traders who require a basic KYC.
But recently in April 2018, LocalBitcoins have started urging customers who have had a significant volume of trading in last few months to get themselves verified and this is to stop illegal laundering of money and in some countries like the US, this is mandatory.
So if you are looking at LocalBitcoins as KYC-less exchange then you might be wrong!!
Searching Traders On LocalBitcoins
You can filter out ‘Buy’ and ‘Sell’ trades and traders by selecting your preferred country and the payment method (will talk about this later).
Similarly, you can apply the same filter on the ‘sell’ side and find out the relevant trade.
Now, let us say you want to ‘Buy’, so you will look for ‘Sellers’ and this is how the trade details put by a seller will look like:
Check the trade details/conditions and always look out for more feedback score. Anything over 90% is a good trader to trade with.
LocalBitcoins Payment Methods & Fees
You can also put one more criterion while filtering out traders on LocalBitcoins, that of payment method i.e. your preferred payment method to receive fiat if you are a seller and to pay fiat if you are a buyer.
Here, I have filtered out this trader based on two criteria i.e. country and payment type. Similarly, you can filter traders if you want to sell Bitcoin.
Some other popular payment filters through which you can find your traders are:
The fee structure is quite nominal on LBC. Registering, buying, and selling Bitcoins is completely free. LocalBitcoins users who create advertisements are charged a 1% fee for every completed trade.
Note: Transactions to wallets of other LocalBitcoins users are free.
Other Features Of LocalBitcoins
All online trades are protected by escrow. When a trade is initiated, the amount of Bitcoins for the trade is automatically reserved from the seller’s LocalBitcoins wallet. This means that if the seller runs away with your money and does not release your Bitcoins, LocalBitcoins.com support can release the Bitcoins to you from escrow. If you’re selling Bitcoins, never release the escrow before you know that you have received money from the Bitcoin buyer. Also, note that local trades do not have escrow enabled by default but when you request and get in trade it becomes enabled. (Source: LocalBitcoins.com)
- Feedback System and Feedback Score
The feedback system of LocalBitcoins gives a transparent picture of all the traders listed on it and shows how positive a particular trader is. This score also decides whether the trader will be listed on the top or at the bottom.
There are four types of ratings or feedback one can give on LocalBitcoins based on their experience of trade.
4. Block without feedback
- 2-FA authentication
2-FA authentication is a very important feature for any exchange, and it is a good idea to add an extra layer of security to the user’s funds. Do read our detailed guide to 2-FA authentication to understand its worth if you don’t know about it yet: What is 2FA and How Does it Work?
That’s why LocalBitcoins also provides this feature and one can activate 2-FA on LocalBitcoins by following this short video guide.
Is It Safe To Trade On LocalBitcoins?
LocalBitcoins is totally safe to trade on if you are cautious and don’t make stupid mistakes.
Think of it as an age-old peer-to-peer barter system where you give one thing in exchange for getting another. All the cautions that you will take in a face-to-face peer trading, you need to take here too.
Some other points that you need to take care are:
- Check the trader’s trust score or feedback score. The higher the score the better it is to trade with that trader.
- Also, check if a trader has done more than 20 trades. It is quite safe to trade with that trader as he/she is not a newbie.
- Always stick to communication on the LocalBitcoins platform itself so that in case of any dispute it can be used as proof.
- Never release the escrow manually before you have checked and received your money with you in your bank or in your hands.
Also, it is best to trade with traders who have a complete profile or you can ask for verification or ID submission for higher amounts before indulging in trade via LocalBitcoins.
So far, LocalBitcoins have earned a lot of trust of the Bitcoin community and have also become the go-to platform to trade Bitcoin in many countries. Also, countries like Venezuela where Bitcoin is kind of illegal, services like LocalBitcoins have become very popular and is evident from the chart:
Harsh has tested dealing with LocalBitcoins in the past. Here is his full experience: How To Purchase Bitcoin using cash [Tutorial]
If you have not used LocalBitcoins yet, please go ahead and use it. If you already have, do share your experience with us in the comment section below.
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