Localbitcoins Peer-to-peer Cryptocurrency Exchange Complete Review 2018

Localbitcoins Peer-to-peer Cryptocurrency Exchange Complete Review 2018

in 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

 

Contents:

  1. What is a peer-to-peer crypto exchange? 
  2. How to sign up and create an account
  3. Localbitcoins security measures
  4. How to buy Bitcoins at LocalBitcoins
  5. How to store and deposit Bitcoins at LocalBitcoins
  6. How to sell Bitcoins quickly 
  7. How to leave an advertisement to sell Bitcoins
  8. Localbitcoins payment methods
  9. Localbitcoins fees
  10. Localbitcoins customer support 
  11. LocalBitcoins pros
  12. LocalBitcoins cons
  13. Useful Links
  14. Conclusion 

 



What is a peer-to-peer crypto exchange? 

p2p crypto exchange

 

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. 


What is escrow? 

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. 


 

How to sign up and create an account

 

localbitcoins crypto exchange

 

  • Complete the sign-up form, then click on the "Register" button

  • Click on the verification link sent to your email address

 

localbitcoins crypto exchange registration

 

The interface of the Localbitcoins cryptocurrency exchange is easy to understand: 

 

Localbitcoins cryptocurrency exchange


 

Localbitcoins security measures

  • 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. 

 

localbitcoins security

 

In the opened window click on the "Security" button, then — "Edit security options"

 

localbitcoins security2

security localbitcoins

 

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. 

 

How to buy Bitcoins at LocalBitcoins

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: 

 

localbitcoins filters

 

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: 

 

map displaying on Localbitcoins

localbitcoins map

 

When you find a seller and a sum of bitcoin you would like to buy, click on the "Buy" button to the right: 

 

Bitcoin buying

 

You will see the seller's info, the minimum amount of the payment he accepts, his location and his advertisement. 

 

bitcoin purchase

 

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: 

 

sellers account localbitcoins

 

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: 

  1. The seller traded more than 100 BTC in total
  2. The seller confirmed more than 100 trades
  3. The seller has around 100 trade partners
  4. The score of his feedback is not lower than 98 percent
  5. The seller has an active account during a year
  6. The seller verified his phone number, company account, and email
  7. 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. 

 

button of payment finish

 

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: 

  1. Do not sell outside Localbitcoins if don't want to get scammed. 
  2. Have all the communication at the Localbitcoins message box. If you don't, the support will not be able to help you. 
  3. 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: 

 


 

How to store and deposit Bitcoins at 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: 

 

Localbitcoins wallet button

 

To receive Bitcoins click on the "Receive Bitcoin" button where you will find the address of your wallet and the current transaction fees: 

 

bitcoin wallet address

 

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. 


 

How to sell Bitcoins quickly 

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. 

 

localbitcoins quick sell

 

  • Click the search button and the website shows you a list of offers. 
  • Select the most appropriate for you one

 

localbitcoins search result to sell

 

 

  • 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"

 

release bitcoin from the escrow button

 

Here is a short video from Localbitcoins on how to sell Bitcoins: 

 

 

 


 

How to leave an advertisement to sell Bitcoins

To sell Bitcoin you should leave an advertisement. To do this click on the speedometer icon on the top right: 

 

leaving an advert

 

On the next dashboard click on the "Create advertisement" button: 

 

creating advert

 

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:

 

advertisement on localbitcoins

Advertisement requirements

Set the following: 

  • location
  • currency
  • payment method
  • price
  • limits
  • 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.

 

Required options

  • 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 payment methods

Localbitcoins carries out the following payment methods: 

  1. Cash
  2. Wire transfer
  3. Credit card
  4. Amazon gift card
  5. Google Wallet
  6. PayPal
  7. Square Cash
  8. Venmo
  9. Western Union
  10. Xoom 
  11. Cash via mail
  12. Skrill
  13. MoneyBrokers
  14. Neteller

 

Localbitcoins fees

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 customer support 

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. 


 

LocalBitcoins pros:

  • Plenty of payment methods
  • Buyer and seller can look through each other's information
  • No transaction fees for buyers
  • Ecrow 
  • Decentralized
  • No third parties
  • Fast and secure transactions
  • No limits for buying/selling

 

LocalBitcoins cons:

  • 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

 

Useful Links


 

Conclusion

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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