LocalCryptos is a marketplace allowing you to buy Bitcoin and Ether from your own non-custodial wallet. Messages between seller and buyer are end-to-end encrypted.
LocalCryptos is a peer-to-peer marketplace allowing you to buy bitcoin and ether directly from sellers all around the world. This is different from traditional cryptocurrency exchanges where buyers and sellers are matched in an automated way and the exchange providers process the transaction end-to-end. LocalCryptos merely provides a platform for sellers and buyers to communicate and trade in a secure and trustless way.
Because you buy from sellers who determine their own prices and need to make a profit to sustain their activities, prices are usually higher on this platform. Moreover, as with all marketplaces you have to do your due diligence to avoid getting scammed.
LocalCryptos features several measures to make trading on its platform secure:
LocalCryptos is also one of the few peer-to-peer exchanges that doesn’t enforce ID verification on users. Buyers and sellers only have to verify their email address. Phone number verification is optional but some sellers require it from buyers before engaging in a trade.
While the lack of ID verification can seem odd at first glance, you’ll notice that if you stick to safety best practices the platform is perfectly secure as it is. We’ll go more into security practices below.
One other characteristic about LocalCryptos that is worth mentioning, is that it’s non-custodial. This means that you will trade from your own wallet which only you control. LocalCryptos gives you the option to either create a web-wallet upon Sign-up or to connect with your own Ethereum wallet if you already have one. They support Metamask, Fortmatic, WalletConnect and Portis.
If you’re not too familiar with Ethereum wallets, we recommend you sign-up the normal way and let LocalCryptos generate a non-custodial wallet for you.
LocalCryptos currently offers bitcoin and ether on its platform and has announced plans to add more cryptocurrencies soon.
In terms of payment methods, LocalCryptos itself doesn't accept any fiat currencies or payment methods since it's not involved in the payment occurring between buyer and seller. It's entirely up to the sellers to decide which currency and payment method they want to accept. However, marketplaces can decide which payment methods they list as available options and LocalCryptos is one of the few marketplaces that offers cash trades and gift cards. Other popular payment methods on the site include:
The good news: there are trades available in most countries and payment methods and you can easily search for them by filtering for the appropriate parameters. Keep in mind that different payment methods will result in different exchange rates, since some methods are riskier than others. For example, sellers willing to accept PayPal are usually selling bitcoin at a premium to the market price. There's two reasons for that: 1) buying bitcoin with PayPal is in high-demand 2) the method can be risky for the seller since the buyer can initiate a chargeback after the trade, potentially leaving the seller with nothing.
Because of this, you will usually get the best price for buying crypto using an irreversible payment method such as cash deposits or wire transfers.
LocalCryptos charges buyers a 0.75% fee and sellers a 0.25% fee. This is in contrast to LocalBitcoins for example, who only charge the seller. The reason for the significant discount on sellers is that LocalCryptos wants to encourage people to place offers.
In addition to the platform fee, there are other costs arising from the fact that the escrow is in fact, a smart contract on the blockchain. To execute the functions of this smart contract, small transactions need to be paid for to miners, which is why you’ll receive a tiny bit less than indicated on the trade.
First, the escrow needs to be “funded” by the seller, then, when the buyer has marked the trade as paid the assets are “locked”, and finally they are “released” when the seller has received the payment.
Although LocalBitcoins has been around for longer (since 2012) and might have a little bit more trade activity on its platform we like LocalCryptos more for several reasons. First, it is completely non-custodial, meaning that your funds are on-chain and can only be accessed by you. Even if LocalCryptos gets hacked or out of business your funds are not at risk.
Furthermore, they are more focused on privacy, allowing users to buy bitcoin and ether without ID and encrypting all messages end-to-end. In terms of payment methods, they enable cash trades and gift cards as eligible payment methods, which are more privacy-respecting than for example credit cards.
After filtering out your sellers by the preferred location and payment method, you need to choose who you are going to deal with. Sometimes it’s worth paying a bit more in order to conduct a transaction with a more trustworthy seller. Look at the seller’s transaction history and see how he was rated in past transactions.
Go over the seller’s profile and make sure that he or she qualifies as follows:
If you can’t find a seller that matches all of the above, try to find the next best thing. The idea is to do your homework and see that the seller has actually completed large successful trades in the past. Below is a screenshot of a trader profile that looks trustworthy. As you can see some sellers opt to import their online-reputation from other platforms such as LocalBitcoins where they have completed more trades, to make their profile more attractive.
Send a message to the seller requesting a trade and wait for their response. DO NOT:
LocalCryptos is certainly a trustworthy platform. We like the user-friendly interface and the focus on privacy. However, as on any other internet platform where you interact with strangers, it’s important you proceed with caution. LocalCryptos’ escrow service mitigates most risk involved in the transaction so make sure you use it appropriately and never send payment before the seller’s funds are in escrow.
We are a multi-faceted team of crypto enthusiasts based in Berlin.
© 2021 cryptotesters UG
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