Looking to buy or sell Bitcoin, but don’t know where to start? You’re likely seeking a reliable platform that can make sure you get a fair and secure exchange in your preferred currency.
Our recommended place to start is LocalBitcoins, one of the internet’s most popular Bitcoin trading sites.
An online marketplace that connects buyers with sellers, the concept behind LocalBitcoins makes peer to peer trading simple. And, LocalBitcoins hosts more than 8 million global users, so you can rest assured that you are taking a well-trodden path whether buying or selling on this crypto exchange site.
Now, before you engage with LocalBitcoins services, naturally you will want to know the ins and outs of this service.That is where our Average Cash team comes in.
Today, we present to you our complete LocalBitcoins Review. We’ve done the work to assess the value and security of this high traffic Bitcoin exchange site so that you don’t have to. Read more to learn all you need to know about LocalBitcoins and how it compares to other trending exchanges.
What makes LocalBitcoins a top choice for Bitcoin buyers and sellers? From our experience crafting this LocalBitcoins review, the benefits of this exchange can be summarized in three main points:
- 1Escrow service to ensure secure transactions
- 2Low fees
- 3Wide range of accepted payment methods (arguably more than any other online crypto exchange)
Considering these benefits, it is no surprise that since LocalBitcoins was founded back in 2012, the platform has grown to become one of the largest and most employed exchanges. And, more users means more opportunities to expand and profit from your Bitcoin portfolio.
There is one key limitation of LocalBitcoins to note, though. As the platform’s name suggests, this exchange is exclusive to trading Bitcoin. You are not able to exchange any other cryptocurrencies here.
While this may be an inconvenience for some users, throughout our LocalBitcoins review we’ve learned that the pros of this platform far outweigh the cons. You’ve got a versatile and secure place to trade Bitcoin, which we prefer over operating on an exchange that lets you trade a wide range of cryptocurrencies, but cannot guarantee the same security, escrow, and low fee services.
It is good to know too that if you like the LocalBitcoins platform, similar spaces exist for Ethereum and Monero: check out LocalEthereum and LocalMonero for online marketplaces that trade these cryptocurrencies.
Local Bitcoins Review: Services and Benefits
Now, let's go into more detail with this LocalBitcoins review and discuss how exactly these services work for you and your trades.
If you are wondering “is LocalBitcoins safe?”, rest assured that the platform’s escrow service is one of the many features that ensure users’ security on this site.
When you are conducting a trade with another LocalBitcoins user, the platform acts as a third party to mediate this exchange. LocalBitcoins will hold the Bitcoins being offered by a seller in an escrow account until the funds have been transferred.
Then, the Bitcoin seller can release the crypto from the escrow account and into your hands.
This transfer method can also protect LocalBitcoins users from scammers on the platform. If you are a buyer transferring funds to a seller, the escrow account ensures that the seller can’t bail on their end of the deal.
If they try to take your money without sending the advertised Bitcoin, the LocalBitcoins support team can simply release those Bitcoins from the escrow account for you.
Low User Fees
In our LocalBitcoins review, we have found LocalBitcoins’ fees to be very reasonable.
LocalBitcoins services are free for buyers, including the benefits of the secure escrow service the exchange provides. There is also no registration fee for new users on the platform, which is a big draw for its wide user base.
However, let's say you need to transfer your purchased Bitcoin to a wallet outside of the LocalBitcoins platform. This will incur a Bitcoin Network fee. To avoid this fee, you can keep your transfers contained to the wallet of LocalBitcoins users only.
The only remaining charge that exists on LocalBitcoins is a 1% flat fee on all trades completed by sellers who advertise on the site. But, again, this tax is quite fair considering the wide reach of this popular crypto market.
Another attractive feature that makes LocalBitcoins popular is the wide range of payment options it gives users.Here is a list of payment options that LocalBitcoins offers. Note that this is not a comprehensive list of all payment methods available on the site (there are more than 150 listed), but rather a small sample to demonstrate the platform’s versatility:
Keep in mind that depending on the payment method you select, different exchange rates may apply. This is especially true for payment methods that are more high risk.
For example, payment options that are at risk of chargebacks create the potential for a scenario where the Bitcoin transfer completes, but the payment host is still able to complete a chargeback and take those funds out of the seller's account. As a response to this risky possibility, some sellers will charge a premium for these payment options as a sort of “insurance” against chargebacks.
Despite the possibility that some payment methods will incur higher exchange rates, the final LocalBitcoins review on payment is this: the wide range of payment possibilities is a big draw for users and lends to the popularity of this platform.
The accessibility of LocalBitcoins is further broadened by its global reach; LocalBitcoins is available in more than 200 countries. More often than not, buyers and sellers use LocalBitcoins because they simply cannot find the same range of payment options on other platforms.
How to Use LocalBitcoins
With no registration fee, and very few hoops to jump through, using LocalBitcoins is easy enough. For this LocalBitcoins review, our team was able to register on the site in minutes.
Once you sign up for an account, LocalBitcoins sets you up with a free online Bitcoin wallet.
You must put any Bitcoin you intend to sell in this secure wallet.
With no registration fee, and very few hoops to jump through, using LocalBitcoins is easy enough.
For the purposes of our LocalBitcoins review, our team was able to register on the site in mere minutes.
Once you sign up for an account, LocalBitcoins sets you up with a free online Bitcoin wallet. You must put any Bitcoin you intend to sell in this secure wallet.
From there, the marketplace operates similar to a Craigslist page. If you intend to buy Bitcoin, search for advertisements that appeal to you. You can filter your search through the advertisements to only see sellers offering Bitcoin exchanges in your preferred currency, location, and payment method.
If you want to sell your Bitcoin, you have the same options to customize your advertisement. Set the price of your Bitcoin in your currency and decide what payment options you want available to your purchaser. If you don’t have a particular payment option in mind, you can indicate all online offers to make the platform’s numerous methods available.
LocalBitcoins does not enforce limits on buyer or seller accounts. This gives users the freedom to set their own prices and limits on trades.
In essence, the unique function of LocalBitcoins is that it operates as a peer-to-peer (p2p) network with few barriers regarding who can join the platform and how they use it.
What does this mean for our LocalBitcoins review? The benefit is this: users from countries that don’t have access to regulated Bitcoin exchange platforms can use LocalBitcoins to purchase and sell Bitcoin. However, this open marketplace also invites scammers into the mix.
In the next section, we are going to go over what makes LocalBitcoins safe, and what action you can take as a user to make your p2p exchanges even safer.
Is LocalBitcoins Safe?
The short answer is yes, LocalBitcoins is a safe platform when you trade with users who operate in good faith.
The pitfalls of this exchange site emerge not with LocalBitcoins itself, but rather with the odd shady user who poses as a legitimate trader but actually intends to carry out a scam.
In recent years, LocalBitcoins has responded to an increase in users with malicious intent by adding more security features to their platform.
This has increased LocalBitcoins’ reputation score on Trustpilot to a respectable 4.8 rating.
While LocalBitcoins takes action to ban bad actors, you should always proceed with caution when interacting with a new seller. A good rule of thumb is to seek out sellers based on their reputation, rather than the price they are offering. An enticingly low BTC price is a good indicator that the seller is trying to take advantage of users.
You can also tell if a LocalBitcoins user is reliable based on their profile, which is displayed publicly on the site. Good signs include a high feedback score from previous transactions, a high number of trades, an account that has been on the site for more than a year, and verified contact information.
While crafting this LocalBitcoins review, we were also pleased with the additional security features this platform has in place, such as two step authentication on your account, a login guard, and a support team able to respond to conflicts between users.
LocalBitcoins vs. Coinbase
How does LocalBitcoins compare to well known crypto exchange platform, Coinbase?
For starters, the model of each platform is inherently different; LocalBitcoins operates a peer to peer communication network whereas Coinbase is a centralized third party.
Unlike the LocalBitcoins marketplace, Coinbase puts more regulation and oversight into the way Bitcoin is exchanged, which might turn off users who prefer a more decentralized market approach.
Another key difference is that LocalBitcoins operates with Bitcoin only, whereas Coinbase also trades Ethereum and Litecoin. So, if you are looking for a platform that has a wider range of cryptocurrency trade options, Coinbase may be the better choice.
Let's talk about the cost of using LocalBitcoins vs. Coinbase. While Coinbase has low fees, the fees at LocalBitcoins are even lower, if not non-existent. With that being said, you get what you pay for; Coinbase does offer more user-friendly services that can benefit beginner traders, while LocalBitcoins is better suited for more intermediate or advanced users who don’t need as much guidance.
When comparing the security level of LocalBitcoins vs. Coinbase, both platforms have their strengths and weaknesses. In the past, Coinbase has been subject to security breaches that put user assets at risk.
Similarly, users on LocalBitcoins have fallen victim to scammy trades. The platform with the better security depends on how much you trust yourself to make wise exchange decisions online. If you are confident that you can avoid scam advertisements, LocalBitcoins is arguably the more secure option.
Our Final LocalBitcoins Review: The Pros and Cons
In all, our LocalBitcoins review concludes that this crypto exchange platform is legit, secure, and easy to use.
We recommend LocalBitcoins to intermediate or advanced Bitcoin traders who seek a versatile, decentralized market and are willing to put in the work to ensure they are only trading with reputable parties.