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LocalBitcoins

LocalBitcoins
FoundedJune 2012 (2012-06)[1]
FounderJeremias Kangas
DefunctFebruary 2023 (2023-02)
Headquarters
Helsinki
,
Finland
Area served
Worldwide[2]
Key people
Sara Leppänen (CEO)
Nikolaus Kangas (former CEO)
Jeremias Kangas (former CEO)
Number of employees
100+
Websitelocalbitcoins.com

LocalBitcoins was a peer-to-peer bitcoin exchange platform based in Helsinki, Finland.[3][4]

Its service facilitated over-the-counter trading of local currency for bitcoins.[5] Users posted advertisements on the website, where they stated exchange rates and payment methods for buying or selling bitcoins.[6] Other users replied to these advertisements and make the payment in their specified payment method. In December 2020, LocalBitcoins had over 1,000,000 active traders with a trade volume of 612 million US dollars between October and December 2020.[7] LocalBitcoins shut down in February 2023.

History

LocalBitcoins was founded in June 2012 by Jeremias Kangas. He implemented an escrow system for the marketplace by the end of 2012. The website started generating revenue by the beginning of 2013, and in 2020 there was an average of 29,566 successful trades per day.[7]

In 2018, LocalBitcoins headed the list of best financially performing companies in Finland arranged by the local specialized publication Kauppalehti.[8]

In 2014, 2016, and 2018 people who used the site were arrested for money laundering and related crimes.[9][10][11]

In January 2019, attackers stole bitcoin worth $28,200 from users' LocalBitcoins accounts.[12] LocalBitcoins was able to identify and solve the case immediately, announcing so to its users. On the same day, LocalBitcoins shared that LocalBitcoins accounts were safe to use and emphasized the importance of two-factor authentication.

In November 2019, LocalBitcoins.com got registered as a Virtual Currency Provider by the Finnish Financial Supervisory Authority.[13]

On 9 February 2023, LocalBitcoins announced it would cease operations later in February.[14]

Services

The website offered a service to facilitate the locating of Bitcoin users, who could meet for person to person trading of bitcoin.[15]: 23  The site was suggested for casual traders seeking more privacy.[15]: 207  The site used an escrow system, and the transfer of bitcoin was made after funds were received in the sellers account.[16][17]: 221  LocalBitcoins had a reputation system for users and an escrow and conflict resolution service.

References

  1. ^ Knibbs, Kate (5 February 2015). "Meet the Street Dealers Who Peddle Bitcoin". Gizmodo. Archived from the original on 30 December 2016. Retrieved 30 December 2016.
  2. ^ Stecklow, Steve (29 September 2017). "Making a fortune from arranging private bitcoin transactions". mint. Archived from the original on 30 September 2017.
  3. ^ "Crypto Peer-to-Peer Exchanges Grow in Popularity as Regulatory Scrutiny Rises". Bloomberg.com. 11 July 2019.
  4. ^ Smith, Ian (11 February 2018). "The FT 1000: The complete list of Europe's fastest growing companies". Financial Times. Archived from the original on 20 February 2019.
  5. ^ McMillan, Robert (28 March 2013). "Why the Only Real Way to Buy Bitcoins Is on the Streets". Wired. Condé Nast. Archived from the original on 16 April 2014. Retrieved 19 February 2014.
  6. ^ "Even China Can't Kill Bitcoin". Bloomberg.com. 24 February 2017.
  7. ^ a b "Bitcoin Adoption: Nearly 1M Active LocalBitcoins Users in Q4 2020, while P2P Competitor Paxful Reports Steady BTC Trading Growth". Crowdfund Insider. 4 February 2021. Archived from the original on 4 February 2021.
  8. ^ "Kauppalehti Menestyjät | Yritykset | Kauppalehti". Tärkeimmät talousuutiset | Kauppalehti. Archived from the original on 23 October 2018.
  9. ^ "LocalBitcoins.com Targeted - Another Major Bitcoin Exchange May Be Under Threat". Business Insider. 9 February 2014. Archived from the original on 14 February 2014. Retrieved 19 February 2014.
  10. ^ "Former Shreveport chiropractor, son sentenced for operating illegal bitcoin exchange business". www.justice.gov. 25 May 2017. Archived from the original on 9 April 2023. Retrieved 31 May 2019.
  11. ^ Farivar, Cyrus (11 July 2018). "Woman who once bought bitcoins for $300,000 cash in paper bags sent to prison". Ars Technica. Archived from the original on 11 July 2018. Retrieved 7 April 2019.
  12. ^ Cimpanu, Catalin (27 January 2019). "LocalBitcoins blames security breach on forum 'third-party software'". ZDNet. Archived from the original on 26 October 2020.
  13. ^ "The Financial Supervisory Authority granted five registrations as virtual currency provider". finanssivalvonta.fi. Archived from the original on 21 February 2020. Retrieved 21 February 2020.
  14. ^ "LocalBitcoins will discontinue its service". localbitcoins.com. Archived from the original on 9 February 2023. Retrieved 9 February 2023.
  15. ^ a b Guttmann, Benjamin (25 November 2013). The Bitcoin Bible. Books on Demand. ISBN 978-3732284320.
  16. ^ Patterson, Sam (4 December 2013). Bitcoin Beginner: A Step By Step Guide To Buying, Selling And Investing In Bitcoins. Better Life Publishers. ISBN 9781483521060.
  17. ^ Cofnas, Abe (20 July 2015). The Forex Trading Course: A Self-Study Guide to Becoming a Successful Currency Trader, 2nd Edition. Wiley Trading. ISBN 978-1118998656.
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