Localbitcoins, the Helsinki, Finland-based bitcoin exchange founded in 2012, is shutting down after over a decade of service. The company’s operators attribute the shutdown to the “ongoing crypto winter,” which has prevented them from continuing to offer their bitcoin trading services.
The challenges faced by Localbitcoins and its eventual demise in the crypto market
The first peer-to-peer (P2P) bitcoin exchange, Localbitcoins, is ending operations after over ten years in the industry. The exchange announced the news on its website, stating that new registrations will be suspended from 9 February 2023, and trading will be suspended seven days later, on 16 February. After suspension of trading, Localbitcoins users will only be able to withdraw their bitcoins and have 12 months.
“Originally, Localbitcoins was established to bring bitcoin everywhere and drive global financial inclusion,” the company said Thursday. “We’ve honored that mission for over 10 years, and we’re proud of what we’ve accomplished with all of you, our loyal community.” The Bitcoin exchange added:
We are therefore sad to share, that regardless of our efforts to overcome challenges during the ongoing very cold crypto winter, we have regrettably concluded that Localbitcoins can no longer offer its bitcoin trading service.
In its early years, Localbitcoins was the exchange of choice for peer-to-peer trades globally. The platform saw high volume in the early years, but centralized crypto exchanges eventually surpassed it, leading Localbitcoins to become more prominent in regions without centralized trading options.
Localbitcoin’s worldwide trading volume from 2013 to 2023.
By 2019, the peer-to-peer exchange faced additional challenges as it was required to comply with Know-Your-Customer (KYC) regulations. In addition, Localbitcoin ended in-person trades that year, making the platform less attractive to peer-to-peer traders.
In 2021, during the crypto bull market and resurgence in digital currency prices, Localbitcoins announced the launch of an Android mobile app. Despite this, Localbitcoins never regained the volume it saw in 2017. Even during the 2021 bull market, the platform’s volume continued to decline. Statistics show that Localbitcoins’ volume is currently as low as it was during the bear market of 2015. The first week of February 2023 saw a slight increase, with 6.56 million BTC traded over a seven-day period.
Tags in this story
10 years, 2012, 2019, 6.56 million BTC, android, Bear Market, Bitcoin exchange, bitcoin trading, bitcoin trading service, Bitcoin withdrawal, centralized crypto exchanges, centralized trading options, challenges, crypto bull market, crypto winter, decade, decline, Digital currency prices, finland, global financial inclusion, Helsinki, personal trading, Know-Your-Customer, less attractive, LocalBitcoins, Localbitcoins decline, mobile app, new registrations, operation, peer-to-peer, peer-to-Person Trader, regulations, resurgence, service, seven-day period, shutdown, strong volume, suspended, trading, volume
What do you think is the future of peer-to-peer cryptocurrency exchanges after the closure of Localbitcoins? Share your thoughts in the comments section below.
Jamie Redman
Jamie Redman is the news editor at Bitcoin.com News and a financial technology journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open source and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.
Image credit: Shutterstock, Pixabay, Wiki Commons, Editorial image credit: T. Schneider / Shutterstock.com
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or an endorsement or recommendation of products, services or companies. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is directly or indirectly responsible for damages or losses caused or alleged to be caused by or in connection with the use of or reliance on content, goods or services mentioned in this article.
