Localbitcoins Peer-to-peer Cryptocurrency Exchange Complete Review 2018in Cryptocurrency
Localbitcoins is a peer-to-peer (P2P) cryptocurrency market crypto exchange. The company is based in Helsinki, Finland, in 2012, and gets support from the UK, the USA, China and more than 250 countries around the world except for Germany and New York.
Localbitcoins doesn't have a place or transaction limitations, so if you find a buyer or a seller, you can freely trade as much as you would like directly. The crypto exchange accepts any cryptocurrency and fiats. There are more than 1 million users registered on Localbitcoins.
The service is so popular, that theoretically you can make a money transfer at almost no cost in an hour.
In the guide, I will tell you step-by-step how to use the crypto exchange.
- What is a peer-to-peer crypto exchange?
- How to sign up and create an account
- Localbitcoins security measures
- How to buy Bitcoins at LocalBitcoins
- How to store and deposit Bitcoins at LocalBitcoins
- How to sell Bitcoins quickly
- How to leave an advertisement to sell Bitcoins
- Localbitcoins payment methods
- Localbitcoins fees
- Localbitcoins customer support
- LocalBitcoins pros
- LocalBitcoins cons
- Useful Links
A peer-to-peer (P2P) cryptocurrency exchange is a decentralized crypto exchange platform without any middlemen which doesn't match the orders in the order book for you. The buyer and the seller leave the advertisements and find each other with its help.
Note that P2P crypto exchanges differ from the pure decentralized which use smart contracts in their work.
Escrow is a safety strategy p2p crypto exchanges like Localbitcoins use to ensure that the trade is absolutely fair.
When a buyer shows his interest in the seller's offer, the seller's crypto coins are held by the system in an escrow. When the buyer pays the discussed sum of money, the escrowed coins are transferred directly to his crypto wallet. But first, the buyer should provide a proof of payment to the support service and the seller (if needed) while the seller should ensure the state of his account.
Select "Sign up free"
Complete the sign-up form, then click on the "Register" button
Click on the verification link sent to your email address
The interface of the Localbitcoins cryptocurrency exchange is easy to understand:
- Reputation "ladder" — every trader in the crypto exchange gets a rank according to his previous activity which is also can be seen as a history.
- Escrow — the seller's funds are put to escrow until the buyer make a payment and confirm it. Then the funds are released to the buyer's wallet.
- 2FA verification — a short pin code which is sent to your mobile for you to enter it on the website and confirm that it is you indeed.
To activate it, click on the profile icon near the "Wallet" button, then click on the "Edit profile" button.
In the opened window click on the "Security" button, then — "Edit security options"
Click on the "Enable two-factor authentication" and follow the instructions.
Besides, while editing your profile you can upgrade your account. For example, to enable SMS verification and ID verification which are rather important.
SMS verification provides the largest amount of advertisement meanwhile an ID verification underlines your honesty to buyers. Of course, you can skip the last step but doing so you limit the number of people who will work with you.
- Login Guard option enables you to log in from the same browser. If there are any changes, email verification is required. To activate the option, click on the "Edit login guard options" below the 2FA authorization form.
- Conflict resolution section — if there are any disputes between the buyer and seller, they can email to the support and the last ones will help to settle everything.
- Localbitcoins forum — except for the email support service the issues can be settled on the forum's discussions.
As you can see on the interface screen above, there are several options for buying bitcoins — online or by cash. Moreover, you can filter the existing advertisements:
You can also buy Bitcoin by cash in the next section below. The service allows displaying the places on the map.
For that click on the "Show more on map for buying bitcoins with cash" button:
When you find a seller and a sum of bitcoin you would like to buy, click on the "Buy" button to the right:
You will see the seller's info, the minimum amount of the payment he accepts, his location and his advertisement.
Click on his login and you will see the other information about the seller, such as the trading volume, the number of confirmed trades, whether he verified his account or not, when he last has seen the account, the feedback and so on:
While browsing all the information about the sellers and prices don't choose a trader based on price as there are more criteria for making a choice. Note that you see the sellers from your geo position. Always look through his account.
Here are some hacks to choose the right seller:
- The seller traded more than 100 BTC in total
- The seller confirmed more than 100 trades
- The seller has around 100 trade partners
- The score of his feedback is not lower than 98 percent
- The seller has an active account during a year
- The seller verified his phone number, company account, and email
- The seller is trusted by more than 10 people
If you don`t want to buy all the offered sum, just enter the sum you want to buy and click on the "Send trade request" button. Do not provide your personal info until he answers to you.
If the seller accepts the deal, the sum will be directed to an escrow account. When you pay for the Bitcoins. click on the "I have paid" button. Once the seller verifies he got the payment, Localbitcoins will release the bitcoins from the escrow and put them in your wallet.
Buying bitcoin is free, but if you place an advertisement you will need to pay a one-percent fee. The transactions are instant, although take into account that Bitcoin blockchain takes some time to complete a transaction.
Here are a few important moments:
- Do not sell outside Localbitcoins if don't want to get scammed.
- Have all the communication at the Localbitcoins message box. If you don't, the support will not be able to help you.
- Do not mark the payment as "done" until you really make the transaction or the seller can deny it.
Watch the short video guide on how to buy Bitcoins on Localbitcoins:
Localbitcoins like any other exchange has an installed wallet on the website where you can store your Bitcoins for free. It is just like storing money on your PayPal account, so you can send Bitcoins to anyone or get them sending the address of your wallet to a person.
To proceed to your wallet click on the "Wallet" button in the upper right corner:
To receive Bitcoins click on the "Receive Bitcoin" button where you will find the address of your wallet and the current transaction fees:
Which is more, you can also display the QR-code address for the mobile and look at the old addresses.
Now just copy the address and send it to the person who will give you Bitcoins or deposit them from your Bitcoin wallet.
The quick option to sell Bitcoin is to use the search box on the main page. The mechanism of selling there is almost the same as for buying one:
- Fill in the search box: specify the amount of the crypto coins, the payment method, and the geo position.
- Click the search button and the website shows you a list of offers.
- Select the most appropriate for you one
- Look through the terms of the trade and the buyer's info.
- Type in the blue section how much you will sell and leave a message for the buyer. Click on the "Send trade request button".
- The system will place your Bitcoins into the escrow until the buyer makes a transaction and confirm it. The buyer may also want to know your terms and requirements, so discuss them.
- When you get the buyer's money press "Release bitcoins"
Here is a short video from Localbitcoins on how to sell Bitcoins:
To sell Bitcoin you should leave an advertisement. To do this click on the speedometer icon on the top right:
On the next dashboard click on the "Create advertisement" button:
You will see there a form to fill with a detailed explanation of all the rules and requirements where you will need to choose a payment method, set your pricing, your limits and write your terms of the trade as a free-form message:
Set the following:
- payment method
- terms of trade
There should be at least 0.04 BTC in your LocalBitcoins wallet for your advert's public display.
Only 5 advertisements are allowed at a time and one additional advert for each Bitcoin you trade for 30 days period.
- Location — where your advert will be visible
- Payment method — currency for which you are selling your Bitcoins
- Margin / Price equation — you will probably want to sell your Bitcoins for more than market average price. For that enter a percentage in the margin field. In the price equation field you can specify the options for the price.
- Min. / Max. transaction limit — the smallest and the largest amount of the cryptocurrency someone can buy. However take into account that if you fill the amount that is larger than you have Bitcoins in your wallet, the actual maximum is the overall balance of your wallet.
- Terms of Trade — If you have any specific rules and instructions for a buyer write them in this field.
Localbitcoins carries out the following payment methods:
- Wire transfer
- Credit card
- Amazon gift card
- Google Wallet
- Square Cash
- Western Union
- Cash via mail
As I have already mentioned above, the buyers don't pay any fees while the sellers pay a one-percent fee for the advertisement posting and using the company's escrow.
However, pay attention to the fact that the exchange rate on Localbitcoins is higher than the mid-market rate. Why? Well, I guess you are able to pay some extra money for your privacy, speed and the seller's risks.
Besides, remember that there is a fee while transferring bitcoins from the service wallet to your personal third-party one.
Localbitcoins provide a customer support via email within 24 hours. so, if you have any questions concerning your account, safety, or you need help on a particular issue feel free to create a support ticket. However, don't be that strict if you will not get the response during 24 hours — for instance, on weekends the staff is limited, so the support can work slower.
- Plenty of payment methods
- Buyer and seller can look through each other's information
- No transaction fees for buyers
- No third parties
- Fast and secure transactions
- No limits for buying/selling
- Over the Counter (OTC) transactions security is limited (the buyer and the seller make transactions face-to-face, so their security is only in their hands)
- People may live far from each other and can’t meet-up
- The possibility that someone won’t make a transaction
- You trade with a person face-to-face so you have to provide your own security
- A lot of negative feedback
Localbitcoins is a leader among the peer-to-peer cryptocurrency exchanges and a trusted method of trading Bitcoin that has been functioning over the years. The platform really provides low fees, escrow-based payments with a wide range of payment methods and the ability to stay private. That is priceless indeed.
As to a large amount of the negative feedback I can say that people are not the same everywhere. There can be untrustworthy sellers and buyers, however, in the guide, I tried to explain to you how to avoid scams. Have a good trading!
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