LocalBitcoins.com facilitates an over-the-counter the market where users can exchange fiat currency for bitcoins. LocalBitcoins has a long history as an over-the-counter market and has been established since 2012.
Bids and offers are posted by users. There are two types of trades on LocalBitcoins. Local trades and online trades. The online trades are the most common. Users who post bids and offers are contacted by other users to take the other side of the trade and LocalBitcoins stores each side in an escrow. Depending on the local banking system, the trades may take several days to complete. LocalBitcoins takes a 1% fee in these transactions. Local trades are completed face-to-face and do not have the same escrow protection. Local trades are advantageous to users who wish to stay anonymous. Because it is an over-the-counter market, users will sometimes pay higher prices than they would on an exchange.
LocalBitcoins also have their own wallet but they have noted it is not the most secure and recommend using other wallets. There is some risk associated with using LocalBitcoins if users are not familiar with it. If users selling Bitcoin release the Bitcoin before funds are received, there is a risk that they may not receive the funds for their Bitcoin.
- Long history being established since 2012
- Facilitates both online trades and local trade
- The fee is low at 1%
- Advantageous to users who wish to remain anonymous
- Users are at some risk if they are not familiar with LocalBitcoins.
- Users are likely to pay higher prices