LocalBitcoins

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LocalBitcoins
FoundedJune 2012[1]
FounderJeremias Kangas
Headquarters,
Finland[2]
Key people
Nicholas Kangas (CEO until 10/2017)
Jeremias Kangas (CEO, Founder)
Websitehttps://localbitcoins.com

LocalBitcoins is a bitcoin startup company based in Helsinki, Finland. Its service facilitates over-the-counter trading of local currency for bitcoins.[3] Users post advertisements on the website, where they state exchange rates and payment methods for buying or selling bitcoins.

Other users reply to these advertisements and agree to meet the person to buy bitcoins with cash[4] or pay with online banking. LocalBitcoins has a reputation and feedback mechanism for users and an escrow and conflict resolution service. As of December 2013, LocalBitcoins has around 110,000 active traders with a trade volume of 1,400–3,000 bitcoins per day.

History[edit]

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. In the same month, LocalBitcoins suffered from a security breach, when 30 bitcoins (then worth US$15k) were stolen from its users.[5]

In August 2015, LocalBitcoins ceased to operate in New York state because sellers would have to purchase a BitLicense from the New York State Department of Financial Services to remain in compliance with local financial regulations.[citation needed] In August 2016, LocalBitcoins said that 1.35 million people from 249 countries were using its platform, and that the weekly volume of transactions was US$14 million.[citation needed]

In September 2016, access from Russia to LocalBitcoins was blocked by Roskomnadzor, the executive agency for telecommunications in Russia, after the finance ministry proposed criminalising the use of bitcoin. LocalBitcoins posted instructions for users on how to bypass the access restrictions.[6]

In 2018, LocalBitcoins headed the list of best financially performing companies in Finland arranged by the local specialized publication Kauppalehti.[7]

In 2014, 2016, and 2018 people who used the site were arrested for money laundering and related crimes.[8][9][10]

In January 2019, hackers stole bitcoin worth $28,200 from users' LocalBitcoins accounts.[11]

In June 2019, LocalBitcoins removed local cash ads from their website.[12]

Solution overview[edit]

The website offers a service to facilitate the locating of other Bitcoin users can meet others for person to person trading of bitcoin.[13]:23 The site is suggested for casual traders seeking more privacy.[13]:207 The site uses an escrow system, and the transfer of bitcoin is made after funds are received in the sellers account.[14][15]:221

References[edit]

  1. ^ Knibbs, Kate (2015-02-05). "Meet the Street Dealers Who Peddle Bitcoin". Gizmodo. Archived from the original on 2016-12-30. Retrieved 2016-12-30.
  2. ^ "LocalBitcoins | CrunchBase Profile". CrunchBase. Retrieved 2014-02-19.
  3. ^ McMillan, Robert (2013-03-28). "Why the Only Real Way to Buy Bitcoins Is on the Streets | Wired Enterprise". Wired. Condé Nast. Retrieved 2014-02-19.
  4. ^ Murphy, Kate (July 31, 2013). "Virtual Currency Gains Ground in Actual World". New York Times. Retrieved February 20, 2014.
  5. ^ Berkman, Fran (2014-04-17). "LocalBitcoins exchange confirms security breach, stolen bitcoins". The Daily Dot. Archived from the original on 2016-12-30. Retrieved 2016-12-30.
  6. ^ Mizrahi, Avi (2016-09-13). "Russia's National Censor Blocks Access to LocalBitcoins. LocalBitcoins responded to the ban by instructing Russian users on how to bypass the censorship". Finance Magnates. Archived from the original on 2016-12-30. Retrieved 2016-12-30.
  7. ^ https://www.kauppalehti.fi/yritykset/menestyjat/parhaat
  8. ^ "LocalBitcoins.com Targeted - Another Major Bitcoin Exchange May Be Under Threat". Business Insider. 2014-02-09. Retrieved 2014-02-19.
  9. ^ "Former Shreveport chiropractor, son sentenced for operating illegal bitcoin exchange business". www.justice.gov. 2017-05-25. Retrieved 2019-05-31.
  10. ^ Farivar, Cyrus (2018-07-11). "Woman who once bought bitcoins for $300,000 cash in paper bags sent to prison". Ars Technica. Retrieved 2019-04-07.
  11. ^ Cimpanu, Catalin (January 27, 2019). "LocalBitcoins blames security breach on forum 'third-party software'". ZDNet.
  12. ^ @LocalBitcoins (June 4, 2019). "Note on the removal of Local Cash Ads" (Tweet) – via Twitter.
  13. ^ a b Guttmann, Benjamin (2013-11-25). The Bitcoin Bible. Books on Demand. ISBN 978-3732284320.
  14. ^ Patterson, Sam (2013-12-04). Bitcoin Beginner: A Step By Step Guide To Buying, Selling And Investing In Bitcoins. Better Life Publishers. ISBN 9781483521060.
  15. ^ Cofnas, Abe (2015-07-20). The Forex Trading Course: A Self-Study Guide to Becoming a Successful Currency Trader, 2nd Edition. Wiley Trading. ISBN 978-1118998656.

External links[edit]